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MANAGED 



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State Profiles on Public Sector 
Managed Behavioral Health Care 
and Other Reforms 



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4. 



U.S. DEPARTMENT 
OF HEALTH AND 
HUMAN SERVICES 

Substance Abuse and 
Mental Health Services 
Administration 



Produced for the 



Substance Abuse and Mental Health Services Administration 

(SAMHSA) 

JULY 31.1998 



MANAGED 



CARE 



TRACKING 



SYSTEM 



State Profiles on Public Sector 
Managed Behavioral Health Care 
and Other Rejorms 



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Substance Abuse and Mental Health Services Administration 

(SAMHSA) 

JULY 31,1998 



Acknowledgments 



This guide was prepared by The Lewin Group, 9302 Lee Highway, Suite 500, Fairfax, VA 2203 1 , f703) 2 1 8-5500, 
under the project direction of Gail K. Robinson, Ph.D. The Senior Advisor was Leslie Scallet, J.D., Vice President. 
Additional staff members were Gail Toff Bergman, Project Manager,- Douglas Fountain, Senior Manager,- Christina 
F^ughes, Analyst; Sarah Crow, Research Assistant,- Traci Tunkelrott, Associate,- and Kathy Trzeciak, Staff Assistant. 

The Project Officer for this report was Eric Goplerud, Director of the Substance Abuse and Mental Health 
Services Administration (SAMHSA) Managed Care Initiative. Questions or comments concerning this report should 
be sent to Gail Toff Bergman at the above address and phone, or through e-mail to gtoffberg@lewin.com. 

The project team would like to thank a number of individuals outside of the Lewin team who contributed to this 
report. In particular, we would acknowledge the directors of and staff from all Medicaid agencies in the 50 States and 
the District of Columbia, State Mental Health Authorities and State Alcohol and Drug Abuse Agencies for the count- 
less hours they spent verifying the information on their programs, sending additional information, and participating 
in sometimes lengthy telephone conversations to answer specific questions about their programs. We would also like 
to thank the members of our Stakeholder Advisory Council and their organizations for helping us establish the infra- 
structure necessary to complete this task. 

The Department of Health and Human Services (DHHS) has reviewed and approved policy-related information 
in this document but has not verified the accuracy of data or analysis presented in the document. 

The opinions expressed in this document are the views of the authors and do not necessarily reflect the official 
position of the Substance Abuse and Mental Health Services Administration (SAMHSA), the Health Care Financing 
Administration (HCFA), or the U.S. Department of Health and Human Services. 



DHHS Publication No. (SMA)99-3280 



July 31, 1998 



I 
I 



Contents 



I. Introduction and Methodology I 

Notable Findings I 

Methodology 2 

Organization of the Report 2 

II. Summary of Major Findings 3 

State Status Report 3 

Status of Medicaid Waiver Programs 3 

Status of Non-Medicaid Managed Behavioral Health Care Programs 3 

Table I. Medicaid Managed Care Status Report 4 

Table 2. Status of Non-Medicaid Managed Behavioral Health Care Programs 6 

Privatization Activities/Managed Care Entities 10 

Table 3. Types of State-Contracted Managed Care Entities 12 

Administrative Services Only Arrangements (ASO) II 

Managed Behavioral Health Care Program Design and Structure , II 

Financing IS 

Sources of Funding 15 

Risk and Payment Methods 15 

Behavioral Health Services Under Managed Care Programs 16 

Populations 16 

Lead Agencies 16 

Table 4. States With Integrated Models for Behavioral Health Care 17 

Table 5. States With Partial Carve-Out Models for Behavioral Health Care 18 

Table 6. Full Carve-Out/Stand-Alone Mental Health/Substance Abuse Managed Care Programs . 1 9 

Table 7. Sources of Funding 25 

Table 8. Payment Methods for Managed Care Contractors (MCCs) and Providers 28 

County Roles 31 

Substance Abuse Prevention/Mental Health Promotion 31 

Welfare Reform 31 

Evaluations 31 

Table 9. Mental Health and Substance Abuse Services Under Managed Care Programs 32 

Table 10. Eligible Populations in Managed Behavioral Health Care Programs 38 

Table I I. Lead Agencies for Public Sector Managed Behavioral Health Care Programs 41 

Table 1 2. Welfare Reform and Substance Abuse Treatment 44 

Table 13. Dimensions of Managed Behavioral Health Care Evaluations 46 



July 31, 1998 



III. State Profiles 

Alabama 47 

Alaska 49 

Arizona 5 1 

Arkansas 59 

California 63 

Colorado 71 

Connecticut 77 

Delaware 81 

District of Columbia 85 

Florida 87 

Georgia 91 

Hawaii 93 

Idaho 97 

Illinois 99 

Indiana 1 03 

Iowa 1 07 

Kansas 113 

Kentucky 117 

Louisiana 121 

Maine 1 23 

Maryland 1 25 

Massachusetts 1 3 1 

Michigan 137 

Minnesota 1 45 

Mississippi 153 

Missouri 1 55 

Montana 1 59 

Nebraska 1 63 

Nevada 1 69 

New Hampshire 171 

New Jersey 1 75 

New Mexico 1 79 

New York 183 

North Carolina 1 9 1 

North Dakota 195 

Ohio 197 

vi {SAMHSA} Managed Care Tracking System 



Oklahoma 203 

Oregon 207 

Pennsylvania 213 

Rhode Island 217 

South Carolina 221 

South Dakota 227 

Tennessee 23 I 

Texas 237 

Utah 243 

Vermont 247 

Virginia 25 1 

Washington 255 

West Virginia 259 

Wisconsin 263 

Wyoming 269 

Appendix A A- 1 

Appendix B B- 1 

Appendix C C- 1 



July 31, 1998 



I. Introduction and 

Methodology 

The information in this report was collected for the 
Substance Abuse and Mental Health Services Admini- 
stration (SAMHSA) Managed Care Tracking System 
from January through July 1998. It includes descriptions 
of public sector managed behavioral health care pro- 
grams in the 50 States and the District of Columbia, The 
tracking system collects information and analysis on the 
impact of managed care on Medicaid behavioral health 
services and public mental health and substance abuse 
systems.' 

Notable Findings 

• A total of 97 managed care programs operating in 47 
States include some form of mental health and/or 
substance abuse services. Forty-six of these programs 
are integrated health plans with some mental health 
and/or substance abuse benefits,- 45 are programs spe- 
cific to mental health and/or substance abuse and are 
not associated with physical health plans (i.e., stand- 
alone),- 5 are carve-outs from physical health pro- 
grams, and 3 are partial carve-out programs. 

• Fifty percent of the managed care programs that 
include mental health and/or substance abuse ser- 
vices use Medicaid waivers. The remainder are either 
voluntary Medicaid programs, do not restrict choice 
of Medicaid providers, or involve programs outside 
the purview of Medicaid. 

• Ten States (Arizona, Colorado, Kentucky, Michigan, 
Montana, New Mexico, Pennsylvania, Tennessee, 
Utah, Washington) report that they no longer have 
mental health and/or substance abuse services under 
a fee-for-service system (except those provided to 
specific populations, e.g., American Indians, dual eli- 
gibles, and special needs children) or that they have 
very limited services remaining as fee-for-service. 



Most integrated managed care programs (16 percent, 
or 27 states), contract with private sector organiza- 
tions as the managed care entity. Out of a total of 53 
programs specific to mental health and/or substance 
abuse (i.e., stand-alone, carve-out, and partial carve- 
out), 30 programs in 26 States are managed by pub- 
lic sector agencies or public/private partnerships (57 
percent). 

Private sector organizations (i.e., health maintenance 
organizations and managed care organizations) are 
responsible for most managed care programs that pro- 
vide acute mental health and substance abuse services. 
Specialty long-term care mental health and substance 
abuse services are generally separated from acute care 
health plans (stand-alone, carve-out, partial carve-out) 
and managed by local government entities and net- 
works of community providers in conjunction with 
commercial managed care vendors. Half of all States 
with carve-out or stand-alone arrangements contract 
with government agencies or public/private partner- 
ships to manage the program. 

Most States place managed care entities at risk, even 
if that managed care entity is a public sector agency. 
Managed care entities continue to pay providers on a 
fee-for-service basis without transferring financial 
risk. When providers are also the managed care enti- 
ty, however, they are paid on a capitated basis and are 
at risk. 

Managed care programs offer a broad array of men- 
tal health and substance abuse services. Most pro- 
grams cover mental health inpatient and outpatient 
services, over three-quarters cover outpatient mental 
health and over half cover mental health rehabilita- 
tion and outpatient substance abuse services. 
Detoxification (acute, subacute, and ambulatory) ser- 
vices are covered by one-third of the programs, and 
an additional one-fourth cover Institution for Mental 
Diseases (IMD)' services and mental health and sub- 
stance abuse residential services. 



Additional reports will be published One provides a quantitative 
analysis of the qualitative information collected durinjj 1997 under 
the prototype tracking system 

These do not sum to 97 because two pro^jrams have both inle^;rat- 
ed and carve-out components. 



States have the option of covering services provided in IMDs for 
individuals under age 21 and over age 65, under their Medicaid 
Plans. 



July 31, 1998 



• Over one-third of the mental health specific pro- 
grams cover residential, crisis, rehabilitation, and 
support services. 

• Most programs that cover substance abuse services 
are either integrated with physical health plans or 
combined with mental health services in a behavioral 
health managed care program. Thus, two waiver pro- 
grams cover substance abuse services exclusively 
(Iowa, Minnesota); one is a full carve-out from a 
physical health plan for substance abuse services 
exclusively (Missouri),- five are internal substance- 
abuse-only managed care programs in State sub- 
stance abuse agencies (i.e., non-Medicaid) (Florida, 
Idaho, Kansas, New York, Rhode Island),- and one is 
a prior authorization program for Medicaid sub- 
stance abuse services (South Carolina). 

• Medicaid is the largest source of funding for man- 
aged care programs. Seventy-nine percent of all 
managed care programs reporting financing informa- 
tion include Medicaid funds,- 36 percent of these fund 
their programs with Medicaid dollars exclusively. 
General revenues are the next largest source of fund- 
ing (44 percent), followed by block grants (18 per- 
cent), county funds (12 percent). State Department 
of Mental Health allocations (6 percent), and State 
Department of Alcohol and Drug Abuse allocations 
(3 percent). 

• Sixty percent of programs explicitly mention target- 
ing Aid to Families with Dependent Children/ 
Temporary Assistance for Needy Families (AFDC/ 
TANF) recipients,- over half target Supplemental 
Security Income recipients,- and over a third cover 
expanded women and children populations. 

• Forty-eight percent of States report special provi- 
sions for mental health or substance abuse in 
approved TANF Welfare-to-Work plans. 

• Medicaid is the lead agency for 53 percent of the 
programs, therefore, mental health or substance 
abuse authorities either are the lead agency or share 
responsibility with Medicaid for 47 percent of the 
programs. Looking only at Medicaid plans, mental 
health and substance abuse authorities either are the 
lead agency or share responsibility with Medicaid for 
31 percent of the programs. 



Methodology 



This is the first of three annual State profile reports on 
data in a number of areas, including the organization, 
financing, and administration of managed behavioral 
health care programs in the public sector (see Appendix 
A for a complete project description). TTie report is based 
on information synthesized from various sources and 
then corrected and verified by at least three agencies in 
each State, including the single State Medicaid agency 
and mental health and substance abuse authorities. 
Verification was received from every State and the 
District of Columbia. 

State descriptions were prepared by using baseline 
information from 1996 and 1997 and then incorporating 
and synthesizing updated information from the following 
sources: 

• Print and electronic information sources,- 

• Interviews with National, State, and local contacts 
from government, provider, manager, consumer and 
advocacy organizations,- and 

• Other tracking systems' reports and studies. 

A template was developed to guide data collection. 
Information is more comprehensive for some States than 
for others because of the nature of the data collection 
method. The SAMF-ISA Tracking System will focus on 
closing these information gaps in years two and three of 
the tracking project. 

Organization of the 
Report 

The remainder of this report is divided into two sections: 
Section II, a summary of major findings and current 
trends, reviews major findings from the synthesis of the 
State profiles. Tables are included. Section III presents 
State profiles of managed behavioral health care in the 
public sector. 



{SAMHSA} Managed Care Tracking S/stem 



II. Summary of Major 
Findings 

State Status Report 

Managed care has a strong presence in public sector men- 
tal health and substance abuse program design. All but 
four States now implement some form of managed 
behavioral health care. Medicaid is the primary vehicle 
by which States create and fund managed behavioral 
health programs. Thirty-six States operate 46 Medicaid 
waivers, 8 States operate 12 voluntary Medicaid health 
maintenance organization (HMO) programs, and 26 
States have implemented managed care programs in 
related State systems (e.g., public mental health, public 
substance abuse, corrections, and child welfare). 

The organization, financing, and structure of the 
programs vary tremendously. Some are comprehensive, 
covering multiple populations across the State,- some are 
limited to one county or region,- and some are risk-based, 
while others rely on new administrative strategies to 
manage care. 

Status of Medicaid Waiver Programs 

A total of 46 Medicaid waivers (36 States) that include 
some form of behavioral health have been implemented 
or approved (see table 1). Nineteen States with approved 
or implemented waivers use Section 1115 and 11 use 
Section 1915(b) waivers. Five States have more than one 
1915(b) waiver (California, Iowa, Michigan, Nebraska, 
Texas), and three States have a combination of both 1115 
and 1915(b) waivers (Colorado, Kentucky, Minnesota). 
Additionally, three States have either an 1115 or a 
1 9 1 5(b) waiver pending (Arkansas, Louisiana, Wisconsin) 
to include some form of behavioral health.'' 

Approximately two-thirds of the 46 waivers include 
both mental health and substance abuse, while one-quar- 
ter cover mental health services and not substance abuse 
services. Of the 1115 waivers implemented or approved, 
1 8 include both mental health and substance abuse and 1 
includes mental health services and not substance abuse 



The number of States does not total 36 because some have multi- 
ple waivers. 

A waiver may include physical health care services in addition to 
mental health and/or substance abuse services. 



services. To date, no 1115 waivers cover substance abuse 
service exclusively. Of the 1915(b) waivers implemented 
or approved, 15 cover both mental health and substance 
abuse services, 7 cover mental health without substance 
abuse, and 3 cover substance abuse services without men- 
tal health (California, Iowa, Minnesota). 

The Balanced Budget Act of 1997 (P.L 105-33) 
(BBA) dramatically expands the authority of State 
Medicaid agencies to provide covered health services 
through managed care organizations (MCOs). States no 
longer must seek a waiver to implement mandatory man- 
aged care, although they will still need a waiver to imple- 
ment mandatory managed care for special needs children, 
individuals dually eligible for Medicare and Medicaid, 
and Native Americans. Currently, waivered programs 
that are specific to mental health and/or substance abuse 
services (i.e., stand-alone, carve-out) are defined in the 
States' waiver applications as prepaid health plans 
(PHPs), not as MCOs. By definition, these organizations 
hold limited-risk contracts because the benefit package 
for which they accept risk does not include all Medicaid 
covered services. At this time it is unclear how the provi- 
sions of the new law will affect behavioral health carve- 
out and stand-alone programs. The BBA requires States to 
permit individuals to choose from not fewer than two 
managed care eMtides (defined as MCOs or primary care 
case management organizations. However, the Health 
Care Financing Administration (HCFA) has not ruled on 
whether PHPs will be considered managed care entities. 
If PHPs are not covered under the BBA provisions, States 
planning to contract with a PHP for stand-alone or carve- 
out programs will still need a waiver, and beneficiaries 
may not be afforded a choice. Until a ruling is made, we 
will not be able to determine whether the new law slows 
enthusiasm for carve-out or stand-alone programs. 

Status of Non-Medicaid Managed 
Behavioral Health Care Programs 

Of the 47 States that have managed care activity, 26 
States operate 32 non-Medicaid managed care programs 
(table 2). Ten non-Medicaid programs focus on mental 
health treatment. Six programs focus on substance abuse 
treatment. Ten cover both mental health and substance 
abuse treatment, or are more general programs that offer 
some treatment for behavioral health services. 

Non-Medicaid programs vary considerably in 
administration, service array, and target populations. 



July 31, 1998 



Table l. Medicaid Managed Care Status Report — July 31, 1998 

(Waivers that include mental health and/or substance abuse) 



State 


Medicaid 






Section 1 1 15 


Section 1915(b) 




Program 


Pending/ Approved Implemented 
Planning 


Pending/ Approved implemented 
Planning 


Alabama 


BAY 


MHSA 




Alaska 


N/A 






Arizona 


AHCCCS 


MHSA 




Arkansas 


Benefit Arkansas 




MH 


California 


Medi-Cal Specialty Mental 
Health Services Consolidation 




MH 


Two-Plan Model 




SA 


Colorado 


Mental Health 




MH 


Integrated Care and Financing 
Pilot Project 


MH 




Connecticut 


Connecticut Access 




MHSA 


Delaware 


Diamond State Health Plan 


MHSA 




District of 
Columbia 


HSCSN 


MHSA 




Florida 


PMHP 




MH 


Georgia 


N/A 






Hawaii 


Hawaii QUEST 


MHSA 




Idaho 


N/A 






Illinois 


N/A 






Indiana 


N/A 






Iowa 


MHAP 




MH 


IMSACP 




SA 


Kansas 


N/A 






Kentucky 


Access 




MHSA 


Health Care Partnerships 


MHSA 




Louisiana 


Pilot 




MH 


Maine 


N/A 






Maryland 


HealthChoice 


MHSA 




Massachusetts 


MassHeakh 


MHSA 




Michigan 


Comprehensive Health Plan 




MH 


MSSP 




MHSA 


MIFPI 




MHSA 


Minnesota 


PMAP 


MHSA 




MSHO 


MHSA 




CCDTF 




SA 


Mississippi 


N/A 






Missouri 


Managed Care + 




MHSA 


Montana 


MHAP 




MH 


Nebraska 


Nebraska Health Connection 
MH/SA 




MHSA 


NE Health Connection Medical/ 
Surgical Component integrated 




MHSA 


Nevada 


N/A 






New 
Hampshire 


N/A 






New Jersey 


MCCD 


MHSA 




New Mexico 


SALUD! 




MHSA 



{SAMHSA} Managed Care Tracking System 



Table l. Medicaid Managed Care Status Report — ^July 31, 1998 (continued) 

(Waivers that include mental health and/or substance abuse) 



State 


Medicaid 






Section 1115 


Section 1915(b) 




Program 


Pending/ Approved Implemented 
Planning 


Pending/ Approved implemented 
Planning 


New York 


Partnership Plan 


MHSA 




North 
Carolina 


Carolina Alternatives 




MH SA 


North Dakota 


NoDAC 




MHSA 


Ohio 


OhioCare 


MHSA 




Oklahoma 


SoonerCare 


MHSA 




Oregon 


OHP 


MHSA 




Pennsylvania 


HCBHS 




MHSA 


Rhode Island 


RIteCare 


MHSA 




South 
Carolina 


N/A 






South Dakota 


PRIME 




MHSA 


Tennessee 


TennCare, Partners 


MH SA 




Texas 


STAR 




MHSA 


NorthSTAR 




MHSA 


Utah 


PHMP 




MH 


Vermont 


VHAP 


MHSA 




Virginia 


Medallion II 




MH 


Washington 


Integrated Community 
Mental Health Program 




MH 


West Virginia 


N/A 






Wisconsin 


Medicaid HMO Program 




MHSA 


BadgerCare 


MHSA 




Wyoming 


N/A 






TOTAL 




1 1 18 


2 3 24 


MH = Mental Health. SA = Substance Abuse. N/A = State Does Not Have a Waiver That Includes MH/SA. 
Full program titles and descriptions are provided in the State Profiles Section. 



July 31, 1998 



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Children and Family Services 
Privatization: Private vendor 
provides behavioral health care 
services to child welfare recipients; 
implemented by partnership 
between private non-profit provider 
and private managed behavioral 
health care firm. 




Mental Health and 
Substance Abuse 




1 \ , Hoosier Assurance Plan: Provides 
1 services to adults and children 
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1 . MinnesQtaCare: Provides limited 
mental health and substance 
abuse services for uninsured 
low-income recipients. 

2. Genertjl Assistance Medical Care 
Managed Care: Provides 
limited mental health and 
substance abuse services to 
certain low-income adults who 

i; are not eligible for Medicaid. 


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Managed behavioral health firm 
provides support and gatekeeping 
services on a managed fee-for- 
service basis. 






Alcohol and Drug Managed Care 
Model: Department of Social and 
Rehabilitation Services implemented 
tri-phase alcohol and drug managed 
care model that established five 
regional substance abuse assessment 
centers to provide onsite 
assessment services to all eligible. 




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required by legislation to establish 
mental heafth managed care plan 
for non- Medicaid beneficiaries or 
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July 31, 1998 



Some States have comprehensive programs for the pub- 
lic behavioral health care system (e.g., Nebraska, 
Indiana); v/hile others have implemented single feature 
programs involving managed care tools such as inter- 
agency case management (e.g., Arizona), gatekeeping 
(e.g., Idaho), assessment/level of care determinations 
(Kansas, Missouri), and capitation (South Dakota). Two 
States (Vermont and New h^ampshire) are redesigning 
their public mental health systems and are, among other 
things, moving toward new payment systems involving 
case rates, capitation, and performance funding. Still oth- 
ers target particular populations such as children with 
severe emotional disturbance (SED) (e.g., Hawaii, 
Indiana, Oregon, South Dakota, Texas), general assis- 
tance recipients (e.g., Connecticut), adults with serious 
mental illness (SMI) (e.g., Indiana), and child welfare 
recipients (e.g., Florida, Kansas, South Carolina). Several 
States are also piloting or planning programs with future 
plans to capitate services (e.g., Vermont, Rhode Island). 
Two States report county-operated, non-Medicaid pro- 
grams (Georgia, Iowa). 

Table 2 reflects only those programs that are exclu- 
sively non-Medicaid in nature. It should be noted how- 
ever, that five States (Arizona, Massachusetts, Michigan, 
Montana, Texas) piggyback non-Medicaid populations 3 
with Medicaid programs, essentially using the same man- 
aged care infrastructure for both program components. 

Privatization Activities/ 
Managed Care Entities 

Privatization refers to contracting with independent, 
nongovernmental entities to manage or provide behav- 
ioral health services under a State's managed care pro- 
gram. In this report privatization refers to the extent to 
which government/public roles and responsibilities are 
transferred or contracted to private sector organizations 
under managed care. 

States contract with three types of managed care 
entities to operate their behavioral health plans: public, 
private, or public/private partnerships (see table 3). 
Private sector managed care entities are usually HMOs 
or commercial MCOs. MCOs and HMOs specialize in 
managed care programs for physical health services and 
may subcontract mental health and/or substance abuse 
services to community providers or private behavioral 
health managed care organizations (BHMCOs). 
BHMCOs are commercial managed care vendors that 
specialize in behavioral health services. Two types of 
partnerships have formed: BHMCOs with community 



providers or networks of providers and BHMCOs with 
counties/local government. 

When managed care for behavioral health programs 
emerged, many experts predicted that private MCOs 
would take over responsibility for operating these pro- 
grams for public sector clients, just as they had in the 
general health field. TTie data reported to SAMHSA 
Tracking for 1998 reveal that this prediction holds true 
for integrated health plans, but not for plans designed 
specifically for mental health and/or substance abuse. 
Privatization remains a stable force on the physical health 
side, but private sector organizations have not taken over 
as "managed care entities" in the behavioral health field. 

Managed Care Entities for Integrated 
Health Plans 

For most integrated managed care programs {76 percent), 
27 States contract with private sector organizations as the 
managed care entity. Most of these contracts are with 
HMOs or MCOs responsible for administering physical 
rather than behavioral health programs. Although these 
programs include a component for mental health and 
substance abuse, they most often focus on physical health 
service, and are generally considered integrated programs 
(see the section on Managed Behavioral Health Care 
Program Design and Structure). These programs usually 
cover acute mental health and substance abuse services 
(e.g., inpatient, outpatient) that traditionally have been 
reimbursed under Medicaid's medical insurance program. 
Some States (e.g., Oregon) contract with both public and 
private entities for their integrated programs. 

Managed Care Entities for Managed Care 
Programs Specific to Behavioral Health 

Of 53 programs specific to mental health and/or sub- 
stance abuse (i.e., stand-alone, carve-out, and partial 
carve-out), 30 programs in 26 States are managed by pub- 
lic sector agencies or public/private partnerships {57 per- 
cent). Different combinations of management arrange- 
ment exist. For example, four models in Colorado cut 
across public, private, and partnership approaches. Eight 
States contract with counties or other local government 
entities (California, Michigan, Minnesota, New York, 
North Carolina, Pennsylvania, Washington, Wisconsin),- 
eight States contract with community providers 
(Arizona, Colorado, Indiana, Kansas, Michigan, Rhode 
Island, Utah, Virginia),- and in five States, a State agency 
functions in some capacity as the managed care entity 
(Missouri, New Hampshire, New York, South Carolina, 



10 



{SAMHSA} Managed Care Tracking System 



Vermont). Six States contract with partnerships between 
community providers and BHMCOs (Arkansas, 
Colorado, Florida, Iowa, Kentucky, Montana),- and diree 
States contract with partnerships between government 
agencies and/or private BHMCOs (Delaware, Maryland, 
Pennsylvania). In comparison, 20 States contract with 
private sector organizations to run their behavioral health 
programs (see table 3).' 

Administrative Services Only (ASO) 
Arrangements 

An ASO is an arrangement under which an independent 
organization (e.g., private for-profit managed care organi- 
zation, insurance carrier), performs administrative services 
for a managed care plan in exchange for a fee, without 
assuming any financial risk. ASO services may include 
claims processing, actuarial support, benefit plan design, 
financial advice, medical management, preparation of 
data for reports to governmental units, and other admin- 
istrative functions. Ten States are involved in ASO 
arrangements. 

Four States (Alaska, Florida, Nebraska, and Ohio) 
contract with private, for-profit organizations for a single 
administrative function (e.g., management information 
services, utilization review, prior authorization), while 
three (Connecticut, Kansas, and Maryland) contract 
most administrative services to private entities. One 
county in Colorado and several in Oregon and Texas 
have contracted with private entities under ASO arrange- 
ments. 

Managed Behavioral Health Care 
Program Design and Structure 

States use four structures for their managed behavioral 
health care programs: integrated, partial carve-out, full 
carve-out, and stand-alone. Integrated programs are 
physical health plans that include a mental health and 
substance abuse component, while the other three 
approaches are behavioral health care models designed 
specifically for mental health and/or substance abuse ser- 
vices. 

Integrated Model — Mental health and substance abuse 
services are included with physical health services in a 
comprehensive, general, managed care program (table 4). 



It should also be noted, however, that half these States contract 
with private organizations under administrative-services-only 
arrangements, rather than giving them responsibility for both 
administrative and clinical functions. 



The managed care contract is usually with a managed 
care organization (e.g., F4MO, MCO). States typically 
use this approach for behavioral health services designed 
for a general population, such as Temporary Assistance 
for Needy Families (TANF) recipients, rather than a spe- 
cialized population needing behavioral health care for 
long-term and more severe conditions. Thirty-five States 
operate 46 integrated programs. 

Typically, FHMOs and MCOs are responsible for 
operating these programs. However, the HMO or MCO 
may subcontract with a behavioral health specialty orga- 
nization to deliver mental health and/or substance abuse 
services within a comprehensive plan. In today's vernacu- 
lar, this approach is often referred to as "checkbook" inte- 
gration because payment is integrated for health and 
behavioral health, while the provision of behavioral 
health services is subcontracted to a separate organiza- 
tion, with little involvement on the part of the State. 

A new twist to the integrated approach is known as a 
carve-in: States either require the behavioral health orga- 
nization to have a clinical relationship with the primary 
managed care entity or have other special requirements 
or reimbursement arrangements for HMOs delivering 
behavioral health services (New Mexico, Oklahoma, and 
Massachusetts). 

Partial Carve-Out — States use an integrated approach 
for some mental health and/or substance abuse services, 
but place other, often expanded mental health and/or 
substance abuse services and/or populations under a sep- 
arate managed care program (table 5). The intent of the 
partial carve-out program is to provide a basic set of 
behavioral health benefits under a comprehensive physi- 
cal health plan (e.g., basic benefit plan), but to supple- 
ment them under a separate managed care program for 
special populations (e.g., children with SED, adults with 
SMI) whose needs go beyond those covered by the basic 
plan. Three States operate partial carve-out programs for 
both mental health and substance abuse services. 

Full Carve-Out Model — States completely separate 
mental health and/or substance abuse services and/or 
populations from managed care programs for physical 
health services. Full carve-outs are usually associated with 
Medicaid waiver programs (table 6). Five States (Arizona, 
Hawaii, Massachusetts, Missouri, and Tennessee) operate 
full carve-out programs: four for behavioral health ser- 
vices, and one for substance abuse services only. 

Stand-Alone Pro()rams — Some states operate managed 
mental health and/or substance abuse programs that are 
independent of any other program (i.e., they are not 
carved out of a physical health program). Stand-alone 



July 31, 1998 



Table 3. Types of State-Contracted Managed Care Entities— July 31, 1998 



State 


Program 


Public 


Private 


Partnership 


Alabama 


BAY 




HMO 




Alaska 


Prior authorization 




Peer review 
organization (ASO) 




Arizona 


AHCCCS Carve-out 


Regional behavioral 
health authorities 






ICMP 


State agency 






Arkansas 


Benefit Arkansas 






BHMCO and CMHCs 


California 


Medi'Cai Specialty Mental 
Health Services 
Consolidation 


Counties 






Two-Plan Model 


Local agency 


MCO 




Short*Doyle Program 


N/A 






Colorado 


Mental Health 


CMHC 


HMO and ASO 


BHMCO and CMHCs 




Integrated Care and 
Financing Pilot Project 




HMO 




Connecticut 


Connecticut Access 


HMOs 




GA Behavioral Healtii 
Managed Care Program 




ASO 




Delaware 


Diamond State Health Plan 




MCOs 


State agency and 
MCOs 


Child Welfare 
Demonstration 


State agency 






District of 
Columbia 


HSCSN 




Provider network 




Florida 


PMHP 






MCO and CMHCs 


Department of Children 
and Families 


Unknown 






Capitation Plan 


Unknown 






Behavioral Health Care 
Utilization Management 
Service 




Utilization review 
organization (ASO) 




Georgia 


CSB/ASO 


N/A 






Hawaii 


Hawaii QUEST/CCS 




BHMCO 




Children's Demonstration 




Care management 
organization 




Idaho 


Idaho Substance Abuse 
Services 




BHMCO 




Illinois 


Responsible Choice 


HMOs; prepaid health plans 




Indiana 


HPPD 




MCOs 




Hoosier Assurance Plan 


CMHCs 


Addiction providers 




Dawn Project 




MCO 




Iowa 


MHAF 


BHMCO 




IMSACP 




Non-profit substance 
abuse service provider 
agency and BHMCO 


County Program 


N/A 






Kansas 


Alcohol and Drug Managed 
Care Model 


Regional assessment 
centers 


ASO 




CFS Privatization 


Providers 




Kentucky 


Access 




BHMCO and Providers 


Healtii Care Partnerships 




Regional Partnerships 



12 



{SAMHSA} Managed Care Tracking System 



Table 3. Types of State- Contracted Managed Care Entities^uly 31, 1998 (continued) 



State 


Program 


Public 


Private 


Partnership 


Louisiana 


Pilot 




HMOs 




Maine 


N/A 








Maryland 


HealthChoice 




MCOs; BHMCO (ASO) 


State agency and 
county agency 


Massachusetts 


MassHealth 




HMOs; BHMCO 




Michigan 


Comprehensive Health Plan 




HMO; prepaid health plans 




MSSP 


Community mental 
health boards 






HIFPJ 


Community mental 
health boards 






Voluntary HMO 


HMOs 






Minnesota 


PMAP 




HMOs; prepaid health plans 




MSHO 




HMOs 




CCDTF 


Counties 






MinnesotaCare 




HMOs; prepaid health plans 




Genera} Assistance Medical 
Care Managed Care 




HMOs; prepaid health plans 




Mississippi 


N/A 








Missouri 


Managed Care + 




HMO 




CSTAR 


State agency 






Montana 


MHAP 






BHMCO and providers 


Nebraska 


Nebraska Health 
Connection MH/SA 




BHMCO 




Medical/Surgica} 
Component 




Providers 




Behavioral Health Redesign 




MCO (ASO) 




Nevada 


N/A 








New Hampshire 


New Hampshire Managed 
Care 




HMO 




NHDHHDS 


State agency 






New Jersey 


MCCD 


Hospitals 


Hospitals 




New Mexico 


SALUDt 






HMOs and BHMCOs 


New York 


Partnership Plan 




MCOs 




Pr^akl Mental Health Ran 


State providers 






County Demonstration 


Counties 






North Carolina 


Carolina Alternatives 


County or regional mental 
health boards 






North Dakota 


NoDAC 




HMO 




Ohio 


OhioCare 




HMO 




Accessing Better Care 




HMO 




URIP 




ASO 




Oklahoma 


SoonerCare 




HMOs 




Oregon 


OHP 


Counties (MH) 


HMOs; ASO 




Children's Intensive Mental 
Health Treatment Services 


Counties 


HMOs 




Pennsylvania 


HCBHS 


Counties 




Counties and BHMCO 


Voluntary HMO Contracts 




HMOs 




Rhode Island 


RIteCare 




HMOs 




Detoxification Services 




Provider 




RICover 


CHMCs 







July 31, 1998 



13 



Table 3. Types of State- Contracted Managed Care Entities — July 31, 1998 (continued) 



State 


Program 


Public 


Private 


Partnership 


South Carolina 


Vofuntary HMO Pro^m 




HMOs 




Child Welfare Privatization 
initiative 




MCO 




Prior auAorizatJon 


State agency (ASO) 






South Dakota 


PRIHE 




Providers 




CARE program 




Providers 




Tennessee 


TennCare Partners 




BHMCOs 




MHM Correctiorral 
Services, Inc. 




BHMCO 




Texas 


STAR 




HMOs 




NorthSTAR 




HMOs 


Limited-purpose 
HMOs 


Texas Integrated Funding 
Initiative 




ASO 




Utah 


PMHP 


CMHCs 






Vermont 


VHAP 




BHMCO 


Community providers 
and BHMCO 


DDMHS Restructuring 


State agency 






Virginia 


Medallion II 




HMOs 




Priority Populations and 
Case Rate Funding Pilot 


Community service boards 






Washington 


Integrated Community 
Mental Health Pro^m 


Single or multiple county 
administrative organizations 






Basic HeaJtJi Ran 


HMOs 






West Virginia 


New Directions in Medicaid 
Services Inttiatjve 




Providers 




Wisconsin 


Medicaid HMO Program 




HMOs 




BadgerCare 




HMOs 




CCF 


County agency 






WAM 


County agency 






l«Care 






HMO and community- 
based organization 


Wl Partnership 


Unknov\/n 






PACE 


Unknown 






Wyoming 


N/A 








Total Programs 




28 programs 


61 programs 


14 programs 



14 



{SAMHSA} Managed Care Tracking System 



programs are usually associated with non-Medicaid pro- 
grams, although some Medicaid waivers for mental 
health and/or substance abuse (table 6) are independent 
of any other program. Thirty-three States operate 45 
stand-alone programs: 21 for mental health, 8 for sub- 
stance abuse, and 16 for behavioral health. 

Financing 

Sources of Funding 

Managed care programs are generally financed by six 
funding sources: Medicaid, block grants, State Depart- 
ment of Mental Health allocations. State Department of 
Alcohol and Drug Abuse allocations, general revenues, 
and county funds (table 7). Of the 89 managed care pro- 
grams that reported financing information, 78 percent 
include Medicaid funding. Of those with Medicaid, 36 
percent fund their programs with Medicaid dollars exclu- 
sively. General revenues are the next largest source of 
funding (44 percent), followed by block, grants (18 per- 
cent), county funds (12 percent), State Department of 
Mental Health allocations (6 percent), and State Depart- 
ment of Alcohol and Drug Abuse allocations (3 percent). 
In 1999, we can expect Title XXI Children's Health 
Insurance Program (CHIP) funds to be a major new 
source of funding. 

Risk and Paynnent Methods 

A wide range of payment mechanisms is used in man- 
aged care systems, ranging from capitation to traditional 
fee-for-service (see below). Information reported to 
SAMHSA Tracking in 1998 shows that most States use 
some type of capitation payment to reimburse managed 
care contractors (MCCs). Of 47 States with some man- 
aged care activity, 41 contract with a managed care enti- 
ty on a capitated basis for at least one of their programs,- 
in the remaining 10 States, information is not available or 
the managed care entity or provider is not capitated (see 
table 8). 

In some States, the MCC receives Several types of 
payments (e.g., capitation for Medicaid recipients. State 
allocations for other non-Medicaid recipients, as in 
Montana, Arizona, Michigan). Moreover, some States 
have more than one MCC operating for the same pro- 
gram, and each may receive different types of payment 
(e.g., Colorado, Maryland, Massachusetts). 

Information on the types of payment methods man- 
aged care entities use for providers was not reported for 
at least 30 percent of the programs. However, managed 
care entities are capitating mental health and/or sub- 



stance abuse providers in one statewide Medicaid pro- 
gram (Oregon Health Plan) and one regional Medicaid 
program (Mobile, Alabama). Additionally, Vermont has 
recently launched a restructuring program involving a 
new payment system for providers serving clients with 
long-term mental health needs. The new payment system 
includes both capitation and case rates, depending upon 
the type of service rendered. Case rates are being used to 
pay providers in nine other programs. Vermont and New 
Hampshire have eliminated the MCC by directly paying 
providers on a case rate or capitation basis, thus placing 
the provider at risk, without an intervening MCC 

The payment methods generally used are capitation, 
case rate, global budget, negotiated fee, and fee-for- 
service. 

• Capitation (full and partial] — a risk-sharing reimburse- 
ment methodology based on a preset per-member 
per-month payment to managed care entities for 
administration and/or service delivery. The central 
element of risk under the capitation payment is that 
the payment is fixed, regardless of the volume of ser- 
vices provided. Capitation contracts are complicated 
and can involve an extensive array of risks and risk 
protection provisions. 

• Case Rate — a package price or single payment for all 
services associated with all care immediately before 
and after diagnosis of a condition. TTnis method dif- 
fers from fee-for-service in that providers receive 
only a single bundled payment for all the services 
provided across a multimonth timeframe as opposed 
to receiving a separate payment for each ser\'ice ren- 
dered. It differs from capitation payments because 
each additional patient needing the procedure gener- 
ates another bundled payment under the package 
price structure, but not under a capitation structure. 

• Global Budget — a fixed budget for mental health 
and/or substance abuse. Under these terms, managed 
care entities and providers do not receive any addi- 
tional funding if costs exceed budgeted payments. 
Global budgets can incorporate floating fee sched- 
ules. Floating fee schedules are a mechanism for bal- 
ancing the need to stay within a fixed overall budget 
and the managed care entity's or providers desire to 
be paid on a fee-for-service basis. 

• Neijotiatcd Fee — a discounted fixed fee. An explicit dis- 
count from the full charge level. 

• Fee-For-Scwice — payment at the usual and customarv' 
rate, by service unit, procedure, visit, day, etc. 



July 31, 1998 



IS 



Behavioral Health Services Under 
Managed Care Programs 

The SAMHSA Tracking System collected information on 
the types of services offered by different managed care 
programs (both Medicaid and non-Medicaid waiver pro- 
grams)/ Table 9 shows the actual data collected from 
each program.' Managed care programs cover a broad 
array of mental health and substance abuse services, in 
fact, of the 97 managed care programs, over three-quar- 
ters cover mental health inpatient and outpatient ser- 
vices. (Information was not available or applicable for 14 
of these programs,- therefore, the denominator is 83.) 
Half the programs cover mental health rehabilitation, 
one-third cover detoxification (acute, subacute, and/or 
ambulatory) services, and an additional one-fourth cover 
Institution for Mental Diseases (IMD) services (mental 
health and substance abuse residential services). 

Of the 22 programs that are mental health specific, 
more than half cover inpatient and outpatient services. 
More than one-third of all mental health programs cover 
residential, crisis, rehabilitation, and support services, and 
only two programs cover IMD services. Of the six pro- 
grams that are substance abuse specific, five cover detox- 
ification and outpatient services, four cover residential 
services, and two cover opiate treatment services. 

Of the 55 programs that cover mental health and sub- 
stance abuse services, more than three-quarters cover 
mental health and substance abuse outpatient as well as 
mental health inpatient services. More than one-half 
cover rehabilitation and detoxification. More than one- 
third cover mental health residential, crisis, support, and 
IMD services and opiate treatment. One-quarter cover 
substance abuse residential services. 

Ten States (Arizona, Colorado, Kentucky, Michigan, 
Montana, New Mexico, Pennsylvania, Tennessee, Utah, 
Washington) no longer have mental health and/or 
substance abuse services under a fee-for-service system 
(except for those provided to specific populations. 



in order to maintain consistency across programs, the SAMJ-ISA 
Tracking System used broad categories of services to classify the 
services covered by each State's program(s). Many programs cover 
the same service but label it differently. The service definitions uti- 
lized are found in Appendix C. HCFA has elected to adopt these 
service definitions for use in future surveys of Medicaid benefits 
(SAMHSA Managed Care Tracking Project, The Lewin Group, 
1998), 

For cross-reference purposes in table 9, a State's multiple programs 
are listed in the same order as they are listed in the State's profile. 
For example, Minnesota has five programs highlighted in its State 
profile,- therefore, in table 9 Minnesota is listed five times, follow- 
ing the order used in the profile. 



e.g., American Indians, individuals dually eligible 
(Medicaid and Medicare), and special needs children), or 
they have very limited services remaining fee-for-service. 

Populations 

Table 10 highlights those populations covered under 
managed care programs. Individuals eligible for managed 
care tend to fall into one of the following categories: Aid 
to Families with Dependent Children (AFDC)AANF, 
Supplemental Security Income (SSI) or ABD (Aged, 
Blind, Disabled), expanded Medicaid, general assistance, 
expanded women and children, and clinical criteria (see 
Appendix B for further information on these categories). 
Of 90 managed care programs' in 45 States, 60 per- 
cent cover individuals eligible for TANF/AFDC, over half 
cover SSI or ABD recipients, over one-third cover 
expanded women and children populations, and approx- 
imately one-tenth cover general assistance and expanded 
Medicaid populations.' More than half are Medicaid 
plans, including some non-Medicaid programs that are 
piggybacked onto the Medicaid plan. Overall, a larger 
percentage of Medicaid programs cover AFDC/TANF, 
expanded Medicaid, and expanded women and children 
populations than non-Medicaid programs. 

Lead Agencies 

The SAMFISA Managed Care Tracking System found 
that in States where managed behavioral health care is 
covered by some type of managed care plan (Medicaid or 
non-Medicaid), Medicaid is the lead agency for 53 per- 
cent of the programs,- therefore, mental health or sub- 
stance abuse authorities either are the lead agency or 
share responsibility with Medicaid for 47 percent of the 
programs (table 1 1). Concerning Medicaid plans, mental 
health and substance abuse authorities either are the lead 
agency or share responsibility with Medicaid for 3 1 per- 
cent of the programs. 

The extent of involvement on the part of mental 
health and substance abuse agencies largely depends on 
whether the program is an integrated health plan or a 
separate behavioral health plan designed specifically for 
mental health and/or substance abuse (i.e., a noninte- 
grated program). Medicaid agencies take the lead role 
for 78 percent of all integrated programs, compared 



' Information was not available or applicable for seven programs, 

making the denominator here 90. 
'"Many Medicaid and non-Medicaid managed care programs cover 

more than one population category. 



16 



{SAMHSA} Managed Care Tracking System 



Table 4. States With Integrated Models for Behavioral Health Care— July 31, 1998 
(Medicaid, Non-Medicaid, Voluntary) 



State 


Programs 


Comments 


Alabama 


BAY 


Only in one county. 


Arizona 


1. AHCCCS 


For 1 8-, I9-, and 20-year-olds who are non-SMI; for elderly and 
physically disabled. 


2. ICMP 


For multisystem children. 


California 


Two-Plan Model 


Limited Medicaid SA in a 1 2-county program. 


Colorado 


Integrated Care and Financing 
Pilot Project 


For elderly and younger disabled people in one county. 


Connecticut 


Connecticut Access 


Acute mental health and substance abuse services only 


Delaware 


Child Welfare Demonstration 


SA treatment for parents of children on welfare. 


District of 
Columbia 


hscsn 


1 1 15 waiver for children with SED. 


Florida 


Department of Children and Families 
Child Welfare Program 


Diversion and aftercare services. 


Illinois 


Responsible Choice Voluntary Program 


Basic MH and SA treatment; currently operating in two counties. 


Indiana 


Managed Care for Persons with 
Disabilities and Chronic Illness 


Voluntary for AFDC/TANF, SSI, and SOBRA; serves people with mental 
illnesses, emotional disorders, and chemical addictions. 


Kansas 


CFS Privatization 


Partnership that provides a full range of behavioral health services to 
child welfare clients. 


Kentucky 


Health Care Partnerships 


Only acute detoxification for SA and crisis; primary MH treatment and 
prescription drugs for MH. 


Louisiana 


Pilot Program 


Provides mental health services along with physical health in one 
region of the State. 


Massachusetts 


MassHealth 


Only under HMO program; PCCM carved out. 


Michigan 


1 . Comprehensive Health Plan 


Provides physical health as well as limited outpatient mental health 




services. 


2. MIFPI 


Voluntary program; provides behavioral health services to severely 
impaired multisystem children and adolescents. 


3. Voluntary HMO 


Provides only limited outpatient mental health as part of physical 
health benefit. 


Minnesota 


1. Section III5PMAP 


For Medicaid recipients. 


2. Section III5MSHO 


For Medicaid- and Medicare-eligible individuals over age 65. 


3. MinnesotaCare 


For uninsured working poor 


4. General Assistance Medical Care 
Managed Care 


For certain low-income adults not eligible for Medicaid. 


Missouri 


MC+ 


MH services in four areas of the State. 


Nebraska 


Nebraska Health Connection 
Medical/Surgical Component 


Outpatient MH/SA services and prescription drugs. 


New Hampshire 


New Hampshire Managed Care 


Provides basic MH and SA services across the State. 


New Jersey 


Managed Charity Care Demonstration 


Charity hospitals provide limited MH and SA services to non-Medicaid 
population; voluntary program. 


New Mexico 


SALUD! 


Health plans required to partner with organizations that specialize 
in managed behavioral health care. 


North Dakota 


NoDAC 


Only in one county. 


Ohio 


1. OhioCare 


Basic behavioral health services. 


2. Accessing Better Care 


Voluntary program in two counties; provides basic behavioral health 
services for people with disabilities and chronic illness. 


Oklahoma 


SoonerCare 


HMOs receive enhanced capitation for SMI/SED. 


Oregon 


1. OHP 


Only in 8 counties for MH; statewide for SA services. 


2. Children's Intensive Mental Health 
Treatment Services 


Intensive mental health services. 



July 31, 1998 



17 



Table 4. States With Integrated Models for Behavioral Health Care — July 31, 1998 
(Medicaid, Non-Medicaid, Voluntary) (continued) 



State 


Programs 


Comments 


Pennsylvania 


Voiuntary HMO Contracts 


Includes behavioral health services in 1 1 of the 28 counties in which 
the program is operating; in these 1 1 countries the State's carve-out is 
not yet operational. 


Rhode Island 


RkeCare 


Provides primary and preventive care including MH and SA treatment; 
excludes patients with SMI or SED. 


South Carolina 


Voluntary HMO Program 


Provides acute MH and SA services up to $1,000. 


South Dakota 


PRIME 


Acute MH services except for SED or SPMI; SA services for children 
under age 21 and pregnant women. 


Texas 


|SWR Heahh Plan 


Only MH (except case management and rehabilitation) and only in one 
of two models now being implemented in portions of the State. 


Vermont 


VHAP 


Only acute behavioral health services. 


Virginia 


Medallion It 


Provides limited MH services statewide. 


Washington 


BMP 


Basic MH and substance abuse services to uninsured. 


Wisconsin 


I. Medicaid HMO Program 


Acute MH and SA services. 




2. BadgerCare 


Provides system of care to uninsured and underinsured families. 


3. /-Core 


Regional program for SSI recipients. 


4. W; Partirership 


Regional program for SSI recipients. 


5. PACE 


Covers acute care MH and SA services to frail elderly individuals. 


Total 




46 


SMI = Serious Mental Illness 

SA = Substance Abuse 

SED = Severe Emotional Disturbance 

MM = Mental Health 

AFDC/TANF = Aid to Families with Dependent Children/Temporary Assistance for Needy Families 

SSI = Supplemental Security Income 

SOBRA = Seventh Omnibus Budget Reconciliation Act 

PCCM = Primary Care Case Management 

HMO = Health Maintenance Organization 

SPMI = Severe and Persistent Mental Illness 



Table 5. States With Partial Carve-Out Models for Behavioral Health Care — ^July 31, 1998 



State 


Description of Basic Plan 


Description of Partial Carve-Out 


Delaware — 
Diamond State 
Health Plan 


Children — up to 30 units MH/SA 
outpatient. Adults — up to 30 units 
inpatient; 20 hours outpatient 


Full continuum of services including wraparound services for children. 
with SED. Adults with SMI in fee-for-service system. 


Maryland — 
HealthChoice 


Primary MH and SA services. 


Specialty MH services managed by local core service agencies. 


New York — 
The Partnership 
Plan 


Primary MH and SA services. 


MH and SA services for special needs populations. 


MH = Menul Health 

SA = Substance Abuse 

SED - Severe Emotional Disturbance 

SMI = Serious Mental Illness 



18 



{SAMHSA} Managed Care Tracking System 



Table 6. Full Carve-Out/Stand-Alone Mental Health/Substance Abuse 
Managed Care Programs — ^July 31, 1998 



State 


Carve-Out From 
Physical Health 


Stand-Alone 
Mental Health 


Stand-Alone 
Substance Abuse 


Stand-Alone 

Behavioral 

Health 


Alaska 




Prior Authorization Program: 
Medicaid MH services 
statewide. 






Arizona 


Section mSAHCCa-. 
Statewide; all children and 
adults with SMJ or SED 
(mandatory). 








Arkansas 




Section 1915(b) Benefit 
Arkansas: Children only; 
statewide (mandatory). 






California 




1. Section 1915(b) Medi-Cal 
Specialty MH Services 
Consolidation: Combined 
with State funds 
(Short-Doyle); statewide; 
adults and children 
(mandatory). 








2. Short-Doyle Program: 
State-funded; provides 
reimbursement for 
county MH services to 
Medi-Cal-eligible and 
indigent individuals; 
statewide. 






Colorado 




Section 1915(b) Mental 
Health: Statewide; adults 
and children (mandatory). 






Connecticut 








GA Behavioral Health 
Managed Care program: 
Department of Mental 
Health and Substance 
Abuse Services 
contracts with ASO for 
utilization management 
and claims processing 
for general assistance 
population; statewide. 


Florida 




Section 1915(b) PMHP: 
In Tampa Bay area only; 
adults and children 
(mandatory). 


Capitation Plan: Local social 
service districts receive 
capitated funding for all 
social service programs 
funded by Medicaid and 
State allocations, including 
SA; statewide. 


Behavioral Health Care 
Utilizavon Management 
Service: Medicaid 
contracts with private 
utilization management 
firm to review 
inpatient psychiatric 
services for Medicaid 
recipients who remain 
in the fee-for-service 
system; statewide 



July 31, 1998 



19 



Table 6. Full Carve- Out/Stand- Alone Mental Health/Substance Abuse 
Managed Care Programs — July 31, 1998 (continued) 



State 


Carve-Out From 
Physical Health 


Stand-Alone 
Mental Health 


Stand-Alone 
Substance Abuse 


Stand-Alone 

Behavioral 

Health 


Georgia 


SSsi 






CSB/ASO program: In 
10 counties; individuals 
with mental illness, 
substance abuse, and 
mental retardation 
supported by State 
allocations. 


Hawaii 


Section 1 1 15 QUESTfCCS: 
Combined with State funds; 
statewide; SMt and SED 
populations (mandatory). 






Ch//dren's 

Demonstration: Child 
and Adolescent Mental 
Health Division 
contracts with a single 
care management 
company for services 
to children with SED; 
pilot demonstration; 
island of Hawaii. 


Idaho 






Idaho Substance Abuse 
Services: Gatekeeping and 
SA support services; 
statewide; uninsured 
children and adults 
(mandatory). 




Indiana 


' 






1. Hoosier Assurance 
Plan: State and block 
grant dollars 
combined; 
statewide; children 
and adults, 
uninsured and 
Medicaid-eligible 
(voluntary). 


'■ 






2. Dawn Project: 
Blended funding 
project between 
State and county 
offices; county 
contracts with 
MCO to provide 
SA and MH services 
to children receiving 
SSI; implemented in 
one county. 



20 



{SAMHSA} Managed Care Tracking System 



Table 6, Full Carve-Out/Stand-Alone Mental Health/Substance Abuse 
Managed Care Programs (continued) 



State 


Carve-Out From 
Physical Health 


Stand-Alone 
Mental Health 


Stand-Alone 
Substance Abuse 


1 
Stand-Alone 

Behavioral 

Health 


Iowa 




1. Section 1915(b) MHAP: 
Statewide; children and 
adults (mandatory). 








2. County Program: State 
legislature mandated all 
99 counties to develop 
managed care plan for 
non-Medicaid 
beneficiaries and 
services; 4 counties 
implemented programs 
that blend funds; 
non-Medicaid. 


Section 1915(b) IMSACP: 
Combined with State DPH 
dollars; statewide; children 
and adults (mandatory). 




Kansas 






Alcohol and Drug Managed 
Care Model: Combines State 
and block grant dollars; 
statewide; children and 
adults (voluntary). 




Kentucky 








Section 1915(b) Access: 
Regionally based; adults 
and children 
(mandatory). 


Massachusetts 


Section UlS MassHeaMi: 
Combined with DMH funds; 
statewide; uninsured adults 
and children (mandatory). 








Michigan 








Secvon 1915(b) MSSP: 
Combined with SA 
block grant and State 
general funds; 
statewide; adults and 
children (mandatory). 


Minnesota 






Section 1915(b) CCDTF: 
Combined with SA block 
grant and State general 
funds; statewide; adults and 
children (voluntary). 




Missouri 


CSTAR: Division of Alcohol 
and Drug Abuse manages all 
Medicaid SA services for 
adults; managed fee-for- 
service; Phase 1 of managed 
care; statewide. 








Montana 




Section 1915(b) MHAP: 
Combined with MH block 
grant and State general 
revenues; statewide; adults 
and children (mandatory). 







July 31, 1998 



21 



Table 6. Full Carve- Out/Stand- Alone Mental Health/Substance Abuse 
Managed Care Programs — July 31, 1998 (continued) 



State 


Carve-Out From 
Physical Health 


Stand-Alone 
Mental Health 


Stand-Alone 
Substance Abuse 


Stand-Alone 

Behavioral 

Health 


Nebraska 


- 






1. Section 1915(b) 
Nebraska Health 
Connection MHISA: 
Statewide; children 
and adults 
(mandatory). 


. i 






2. behavioral Health 
Redesign: State- 
operated inpatient 
psychiatric services; 
statewide 
(uninsured and 
underinsured). 


New Hampshire 




NHDMHDS: Community 
mental health centers 
receive performance-based 
funding; MH budget 
allocation; statewide 
(children and adults). 






New York 


d 


Prepaid Mental Health Plan: 
Services provided in 
State-operated facilities; 
statewide; adults and 
children (voluntary). 


County Demonstration on the 
Provision of Managed Addiction 
Treatment Services: 
Demonstration to determine 
best way to organize and 
deliver SA services; two 
counties; children and adults. 




North Carolina 


1 






Seaion 1915(b) Carolina 
Alternatives: Serves 
children and 
adolescents; 32 out of 
1 00 counties 
(mandatory). 


Ohio 




URIP: Medicaid utilization 
review for inpatient 
psychiatric services; 
statewide. 






Pennsylvania 


■i 






Seaion 1915(b) HCBHS: 
Statewide phase-in; 
adults and 
children (mandatory). 


Rhode Island 




RlCover: Pilot for disabled 
populations; statewide 
(voluntary). 


Detoxification services: 
Combines State general 
revenue and block grant 
dollars; statewide; adults and 
children (voluntary). 




South Carolina 


■ 


Child Welfare Privatization 
Initiative: Pilot for MH 
managed care system for 
youth; one region. 


Prior authorization: Medicaid 
SA services; statewide; adults 
and children (mandatory). 





22 



{SAMHSA} Managed Care Tracking System 



Table 6. Full Carve-Out/Stand-Alone Mental Health/Substance Abuse 
Managed Care Programs— July 31, 1998 (continued) 



State 


Carve-Out Fronn 
Physical Health 


Stand-Alone 
Mental Health 


Stand-Alone 
Substance Abuse 


Stand-Alone 

Behavioral 

Health 


South Dakota 




CARE program: Division of 
Mental Health caps 
provider payments for 
adults with SPMI; contracts 
specify maximum amounts; 
statewide (voluntary). 






Tennessee 


Section It IS TemCare 
Portners,' Combined with 
State and locaJ dollars; 
statewkfe; adults and 
children (mandatory). 


MHM Correctional Services, 
Inc.: Individuals in 
correctional system; 
statewide. 






Texas 




Texas Integrated Funding 
Initiative: State MH agency 
pilot to pool public funds 
(State and local) for 
children with SED and SA/ 
dependency problems; 
ASO manages funds; three 
sites (urban, rural, and 
suburban). 




Section 1915(b) 
NorthSTAR: Combined 
with State MH and SA 
funding and MH and 
SA block grants; seven 
counties; adults and 
children (mandatory). 


Utah 




Section 1915(b) PMHP: 25 
out of 29 counties; adults 
and children (mandatory). 






Vermont 




DDMHS: System-wide 
restructuring effort by 
Department of 
Developmental Disabilities 
and Mental Health Services 
that will combine Medicaid 
and State MH funds into a 
single financing system; 
involves case rates and 
capitation for certain 
services; formal functional 
and diagnostic criteria 
used to determine client 
eligibility. 






Virginia 




Priority Populatjons and Case 
Rate Funding Pilot State- 
only dollars; for SMI and 
SED; uninsured, under- 
insured; children and 
adults (voluntary). 






Washington 




SectJon 1915(b) Integrated 
Community Mental Health 
Program: Combined with 
block grant and state-only 
money; 39 counties; adults 
and children (mandatory). 







July 31, 1998 



23 



Table 6. Full Carve- Out/Stand- Alone Mental Health/Substance Abuse 
Managed Care Programs — July 31, 1998 (continued) 



State 


Carve-Out From 
Physical Health 


Stand-Alone 
Mental Health 


Stand-Alone 
Substance Abuse 


Stand-Alone 

Behavioral 

Health 


West Virginia 








New Directions: Funded 
by Medicaid; statewide; 
children and adults 
(voluntary); also 
general assistance 
populations; and public 
mental health clients. 


Wisconsin 








1 . Children Con)e First 
For population with 
SED and/or SMI 
in Dane County 
(voluntary). 








2. WrapAround 
Milwaukee: For 
population with SED 
and/or SMI in 
Milwaukee County 
(voluntary). 


Total 


5 


21 


8 


16 


MH = Mental Health 

SMI = Serious Mental Illness 

SED = Severe Emotional Disturbance 

ASO = Administrative Services Only 

CMHC = Community Mental Health Center 

SA = Substance Abuse 

MCO = Managed Care Organization 

DPH = Department of Public Health 

DMH = Department of Mental Health 

SPMI = Severe and Persistent Mental Illness 



24 



{SAMHSA} Managed Care Tracking System 



Table 7. Sources of Fundinc^-July 31, 1998 



State 


Program 


Medicaid 


Block 
Grants 


State 
DMH 


State 
AOD 


General 
Revenues 


Other 


Alabama 


BAY 


X 












Alaska 


Prior authorization 


Unknown 












Arizona 


AHCCCS Carve-out 


X 


X 






X 


County 


ICMP* 






X 






Other Sute 
agencies 


Arkansas 


Benefit Arkansas 


X 








X 


Title IV-E 


California 


Medi-Cal Specialty Mental 
Health Services Consolidation 


X 








X 




Two-Plan Model 


X 












Short-Doyle Program* 










X 




Colorado 


Mental Health 


X 












Integrated Care and Financing 
Pilot Project 


Unknown 












Connecticut 


Connecticut Access 


X 












GA Behavioral Health Managed 
Care Program* 










X 




Delaware 


Diamond State Health Plan 


X 












Child Welfare Demonstration* 












Title IV-E 


District of 
Columbia 


HSCSN 


X 












Florida 


PMHP 


X 












Department of Children and 
Families* 










X 




Capitation Plan* 


X 








X 




Behavioral Health Care 
Utilization Management Service 


X 












Georgia 


CSB/ASO* 






X 


X 




Other State 
agencies 


Hawaii 


Hawaii QUEST/CCS 


X 








X 


S.H.I.P 


Children's Demonstration* 


Unknown 












Idaho 


Idaho Substance Abuse 
Services* 


Unknown 












Illinois 


Responsible Choice** 


X 












Indiana 


HPPD** 


X 












Hoosier Assurance Plan* 




X 






X 




Dawn Project* 












Other State 

agency, 
county 


Iowa 


MHAP 


X 










County 


IMSACP 


X 


X 




X 






County Program* 




X 






X 


County 


Kansas 


Alcohol and Drug Managed 
Care Model* 




X 






X 




CFS Privatization* 


X 








X 


Title IV-E 


Kentucky 


Access 


X 












Health Care Partnerships 


X 












Louisiana 


Pilot 


X 












Maine 


N/A 














Maryland 


HealthChoice 


X 


X 






X 


State hospital 
funds 



July 31, 1998 



2S 



Table 7. Sources of Funding — July 31, 1998 (continued) 



State 


Program 


Medicaid 


Block 
Grants 


State 
DMH 


State 
AOD 


General 
Revenues 


Other 


Massachusetts 


MassHealth*** 


X 




X 








Michigan 


Comprehensive Health Plan 


X 












MSSP^ 


X 


X 






X 




MIFPI 


X 










Title IV-E, 
county 


Voluntary HMO** 


X 












Minnesota 


PMAP 


X 












MSHO 


X 










Private grant 


CCDTF 


X 


X 






X 




M innesotaCare*** 


X 








X 


Premiums 


General Assistance Medical 
Care Managed Care* 










X 




Mississippi 


N/A 














Missouri 


Managed Care + 


X 












CSTAR* 


X 


X 






X 




Montana 


MHAP*** 


X 


X 






X 




Nebraska 


Nebraska Health Connection 
MH/SA 


X 












Medical/Surgical Component 


X 












Behavioral Health Redesign* 










X 


-:l 


Nevada 


N/A 














New 
Hampshire 


New Hampshire 
Managed Care** 


X 










i; 


NHDMHDS* 














New Jersey 


MCCD 


X 








X 




New Mexico 


SALUD! 


X 












New York 


Partnership Plan 


X 








X 




Prepaid Mental Health Plan* 










X 




County Demonstration* 




X 




X 


X 


County 


North 
Carolina 


Carolina Alternatives 


X 












North Dakota 


NoDAC 


X 












Ohio 


OhioCare 


X 












Accessing Better Care** 


X 












URIP 


X 












Oklahoma 


SoonerCare 


X 












Oregon 


OHP 


X 








X 




Children's Intensive Mental 
Health Treatment Services* 


Unknown 












Pennsylvania 


HCBHS 


X 








X 


County 


Voluntary HMO Contracts** 


X 












Rhode Island 


RlteCare 


X 










Title XXI 


Detoxification Services* 




X 






X 




RICover* 


X 


X 






X 




South 
Carolina 


Voluntary HMO Program** 


X 




X 


X 


X 




Child Welfare Privatization 
Initiative* 


X 








X 


Title IV-E, 
Title IV-B 




Prior authorization 


X 













26 



{SAMHSA} Managed Care Tracking System 



Table 7. Sources of Funding— July 31, 1998 (continued) 



State 


Program 


Medicaid 


Block 
Grants 


State 
DMH 


State 
AOD 


General 
Revenues 


Other 


South Dakota 


PRIME 


X 








X 




CARE program* 


X 








X 




Tennessee 


TennCare Partners 


X 








X 


County 


MHM Correctional 
Services, Inc.* 


Unknown 












Texas 


STAR 


X 








X 




NorthSTAR*** 


X 


X 






X 


Local 


Texas Integrated Funding 
Initiative* 




X 






X 


Other State 

agencies. 

Title IV-E. 

Title IV-B. 

city, county 


Utah 


PMHP 


X 












Vermont 


VHAP 


X 








X 




DDMHS Restructuring* 


X 








X 




Virginia 


Medallion II 


X 












Priority Populations and Case 
Rate Funding Pilot* 










X 




Washington 


Integrated Community 
Mental Health Program 


X 


X 






X 




Basic Health Plan* 










X 


Premiums 


West Virginia 


New Directions in Medicaid 
Services Initiative 


X 












Wisconsin 


Medicaid HMO Program 


X 












BadgerCare 


X 








X 


Premiums 


CCF** 












County 


WAM** 


X 










Other State 
agency, 
county 


l-Care** 


X 












Wl Partnership** 


Unknown 












PACE=^ 


Unknown 












Wyoming 


N/A 














Total 




70 


16 


5 


4 


42 


25 


*Non-Medicaid Programs. 

**Voluntary Program. 

***Medicaid/Non-Medicaid Program. 

DSH = Disproportionate Share Hospital Funds. S.H.I. R = State Health Insurance Program. 

DMH = Department of Mental Health. AOD = Department of Alcohol and Drug Abuse. 

All programs without asterisks are Medicaid programs. 



July 31, 1998 



27 



Table 8. Payment Methods for Managed Care Contractors (MCCs) and Providers — July 31, 1998 



State 


Program 


Capitated 


Negotiated/ 
Flat Fee 


Global 
Budget 


Fee-For- 
Service 


Case 
Rate 


Alabama 


BAY 


MCC, Provider 










Alaska 


Prior authorization 




MCC 








Arizona 


AHCCCS Carve-out 


MCC, Provider^ 






Provider' 




ICMP* 






MCC 






Arkansas 


Benefit Arkansas 


MCC, Provider^ 






Provider' 


Provided 


California 


Medi-Cal Specialty Mental 
Health Services Consolidation 






MCC 


MCC, Provider 




Two-Plan Model 


MCC^ 










Short-Doyle Program* 








MCC, Provider 




Colorado 


Mental Health 


MCC^ 






Provider 




integrated Care and 
Financing Pilot Project 


Unknown 










Connecticut 


Connecticut Access 


MCC^ 










GA Behavioral Heaith 
Managed Care Program* 




MCC 








Delaware 


Diamond State Health Plan 


MCC\ Provider^ 


Provider' 






Provider' 


Child Welfare Demonstration" 


Unknown 










District of 
Columbia 


HSCSN 


MCC 






Provider 




Florida 


PMHP 


MCC^ 










Dept.. of Children & Families* 


Unknown 










Capitation Plan* 


MCC^ 










Behavioral Health Care 
Utilization Management 
Service 




MCC 








Georgia 


CSB/ASO* 




MCC 








Hawaii 


Hav/aii QUEST/CCS 


MCC^ MCC'^ 






Provider 


Provider 


Children's Demonstration* 


Unknown 










Idaho 


Idaho Substance Abuse 
Services* 


Unknown 










Illinois 


Responsible Choice** 


MCC^^ 






MCC^ 




Indiana 


HHPD** 


MCC^ 










Hoosier Assurance Plan* 


MCC^^ 








MCC^ 


Dawn Project* 


MCC^ 










Iowa 


MHAP 


MCC 






Provider 




IMSACP 


MCC 


Provider* 




Provider* 




County Program* 


MCC^' 






Provider 




Kansas 


Alcohol and Drug Managed 
Care Model* 


MCC 










CFS Privatization* 










Provider' 


Kentucky 


Access 


MCC'^ 










Health Care Partnerships 


MCC^ 










Louisiana 


Pilot 


MCC^ 










Maine 


N/A 












Maryland 


HealthChoice 


MCC^ S MCC^ 


MCC 


MCC^ 


Provider 




Massachusetts 


MassHealth*** 


MCC' \ MCC' 






Provider 




Michigan 


Comprehensive Health Plan 


MCC'^' 


MCC = ' 








MSSP*** 


MCO'' 


MCC^* 








MIFPI 


MCO'' 










Voluntary HMO** 


MCC\ Provider' 











28 



{SAMHSA} Managed Care Tracking System 



Table 8. Payment Methods for Managed Care Contractors (MCCs) and Providers— July 31, 1998 
(continued) 



State 


Program 


Capitated 


Negotiated/ 
Flat Fee 


Global 
Budget 


Fee-For- 
Service 


Case 
Rate 


Minnesota 


PMAP 


MCC^ ^ Provider^ 










MSHO 


\^CO\ Provider^ 










CCDTF 






MCC 




Provider 


M innesotaCare* ** 


MCC, Provider^ 










Generat Assistance Medical 
Care Managed Care* 


MCC^ Provider' 










Mississippi 


N/A 












Missouri 


Managed Care + 


MCC^ 










CSTAR* 








Provider 




Montana 


MHAP*** 


MCC 




MCC 


Provider 




Nebraska 


Nebrajto Health 
Connection MH/SA 


MCC 






Provider 


Provider 


Medical/Surgical Component 




MCC^ 








Behavioral Health Redesign* 




MCC 








Nevada 


N/A 












New 
Hampshire 


New Hampshire 
Managed Care** 


MCC^ 










NHDMHDS* 






Provider 






New Jersey 


MCCD 






Provider 






New Mexico 


SALUDt 


MCC 






Provider 




New York 


Partnership Plan 


MCC^ 










Prepaid Mental Heal* Plan* 


MCC^ 










County Demonstration* 


MCC 






Provider 




North 
Carolina 


Carolina Alternatives 


MCC^ 










North Dakota 


NoDAC 


MCC 










Ohio 


OhioCare 


MCC^^ 










Accessing Better Care** 


MCC^ 










URIP 




MCC' 








Oklahoma 


SoonerCare 


MCC^ 










Oregon 


OHP 


MCC'^ MCC^ 
Provider 










Children's Intensive Mental 
Health Treatanent Services* 


Unknown 










Pennsylvania 


HCBHS 


MCC 






Provider 




Voluntary HMO Contracts** 


MCC 










Rhode Island 


RIteCare 


MCC^ 










Detoxification Services* 






MCC 






RICover* 


Unknown 










South Carolina 


Voluntary HMO Program** 


MCC' 










Child Welfare Privatization 
Initiative* 


MCC^ 










Prior authorization 


Unknown 










South Dakota 


PRIME 


Unknown 










CARE program* 




Provider 








Tennessee 


TennCare Partners 


MCC 


Providers 








MHM Correctional 
Services, Inc.* 


MCC 










Texas 


STAR 


MCC 










NorthSTAR*** 


MCC 










Texas Integrated Funding 
Initiative* 




MCC 






Provider 



July 31, 1998 



29 



Table 8. Payment Methods for Managed Care Contractors (MCCs) and Providers — July 31, 1998 
(continued) 



State 


Program 


Capitated 


Negotiated/ 
Flat Fee 


Global 
Budget 


Fee-For^ 
Service 


Case 
Rate 


Utah 


PMHP 


MCC^ 










Vermont 


VHAP 


MCC^ 










DDMHS Restructuring* 


Provider 






Provider 


Provider 


Virginia 


Medallion il 


MCC^ 










Priority Populations and Case 
Rate Funding Pilot* 










Provider 


Washington 


Integrated Community 
Mental Health Progj^m 


MCC^^ 










Basic Health Ran* 


MCC^ 










West Virginia 


New Directions in Medicaid i 
Services Initiative 








'■' Provider 




Wisconsin 


Medicaid HMO Program 


MCC^ 










BadgerCare 


MCC^ 






MCC^ 




CCF** 


Unknown 










WAH** 


Unknown 










1-Care** 


MCC' 










W! Partnership** 


Unknown 










PACE** 


Unknown 










Wyoming 


N/A 












Total 




13 MCC 


1 MCC 


4 MCC 


2 MCC 


1 MCC^ 




1 MCC^ 


3MCC^ 


1 MCC^ 


2 MCC 


1 MCC 




38 MCC 


2MCC^ 


1 MCC 


1 MCC 


6 Provider 




I7MCC^ 


1 MC 


2 Provider 


1 8 provider 


2 Provider' 




14 MCC' 


8 MCC 




2 Provider* 


1 Provider* 




1 MCC 


1 Provider 




1 Provider* 






3 Provider 


1 Provider' 










8 Provider^ 


t Provider* 








*Non-Medicaid Program. ** Voluntary Program. ***Medicaid/Non-Medicaid Program. 

All program names without asterisks are Medicaid programs. 

"N/A" refers to States with no managed care programs that include mental health and/or substance abuse. 

"Unknown" refers to States that have managed care programs that include mental health and/or substance abuse but did not report 

information needed to complete the chart. 

' The MCC is under an administrative services only (ASO) arrangement. 

^ The MCC has a choice of how to contract with providers. It can share risk through subcapitation, case rates, etc., with subcontractors 

or reimburse providers on a fee-for-service basis. 
' Information for providers was not available. 
■• The MCC is also a provider. 

^ More than one MCC is contracted with for the program. 

' Refers to different providers who are contracted with separately by the State or the MCC. 
' One county mental health and substance abuse agency acts as MCC and provider. Other counties are under various types of 

arrangements and cannot be depicted in this chart. 
' Information for the MCC was not available. 
' The contract the State has with the MCC stipulates that either fee-for-service or a form of capitation can be used as a payment 

mechanism. 



30 



{SAMHSA} Managed Care Tracking System 



with 37 percent of all nonintegrated programs. This is 
consistent with the fact that the majority of integrated 
programs are Medicaid. On the other hand, mental 
health and substance abuse authorities are either the 
lead agency or share governance and oversight with 
Medicaid for 63 percent of nonintegrated programs. In 
the same vein, the majority of nonintegrated programs 
come out of the State mental health and substance abuse 
authorities. 



tion pending on this issue, in addition, the majority of 
States did not opt out of Federal requirements to deny 
welfare benefits to TANF recipients convicted of drug 
felonies. On the other hand, 1 3 have decided to opt out 
of this provision and provide TANF to convicted drug 
felons. Finally, 34 States have submitted Welfare-to-Work 
plans, and 23 States have had their plans approved. Of 
the 23 approved plans, 1 1 include provisions for mental 
health and/or substance abuse treatment (table 12). 



County Roles 

Ten States operate programs run by counties, mental 
health boards, or regional authorities (Arizona, Cali- 
fornia, Kansas, Michigan, New York, North Carolina, 
Oregon, Pennsylvania, Virginia, and Washington). 
County involvement has been more significant in mental 
health than in substance abuse programs as well as in 
Medicaid rather than non-Medicaid programs. County 
involvement is an area that we anticipate will generate 
additional information in the next 2 years. 

Substance Abuse Prevention/ 
Mental Health Promotion 

Other than early and periodic screening, diagnosis, and 
treatment, substance abuse prevention and mental health 
promotion services are generally not included in man- 
aged behavioral health care programs. This is an area that 
we anticipate will generate additional information in the 
next 2 years. 

Welfare Reform 

The SAMHSA Tracking System reviewed three issues 
related to how States are implementing welfare reform: 

• Requiring drug testing for TANF recipients,- 

• Opting out of Federal requirements to deny welfare 
benefits to TANF recipients convicted of drug 
felonies,- and 

• Providing for mental health and/or substance abuse 
treatment in Welfare-to-Work plans. 

Overall, 9 States have mandatory drug testing 
requirements for TANF recipients under certain circum- 
stances, while 41 States do not." One State has legisla- 



Evaluations 

Many States have completed or are currently performing 
evaluations of their mental health and substance abuse 
programs. Although the scope and depth of such evalua- 
tions vary considerably from State to State, three dimen- 
sions are commonly assessed: cost, outcomes, and access. 
Definitions of these dimensions also vary. TTie measure- 
ment of cost in some States refers to cost of the program, 
while in other states it refers to cost of the service. In 
addition, measures of outcome range from consumer sat- 
isfaction to patient clinical status. Information is available 
or applicable for 39 States. 

Information available suggests that 20 States have 
evaluated or are evaluating the cost of their programs. In 
addition, 33 States are evaluating or have evaluated out- 
comes, and 31 States are evaluating or have evaluated 
access to managed behavioral health care programs. Of 
the States that perform evaluations, 17 include all three 
dimensions (table 13). 

The impetus for such evaluations can be explained by 
several factors. For the Section 1115 waivers, F4CFA 
requires States to evaluate the first year of the program 
according to cost, outcomes, and access. Also, as funding 
for health care shrinks and more States use managed care 
programs, public managers are under increasing pressure 
to provide evidence of the efficacy and efficiency of these 
new approaches.'* In addition, as managed care becomes 
more prevalent, stakeholders have become concerned 
that costs may be declining at the expense of adequate 
access and quality of care. 



National Governors' Association Center for Best Practices, 
Summary of Selected Elements of State Plans for Temporary 
Assistance for Needy Families (TANF), NGA Website, November 
20, 1997 



Urban Institute: New Federalism 



July 31, 1998 



31 



Residential 
Substance 

Abuse 
Treatment 
Programs 










X 




X 










X 


X 






Opiate 
Treatment 
Programs 






X 




















X 






c 


u 

'x 



■« 

Q 






X 




X 




X 










X 


X 






Outpatient 

Substance 

Abuse 

Services 


X 




X 




X 




X 












X 




X 


Mental 
Health 
Support 






X 




X 


X 




X 


X 








X 






Mental 

Health 

Rehabilitation 




X 


X 




X 


X 




X 


X 








X 




X 


Mental 

Health 

Outpatient 


X 




X 




X 


X 






X 




X 


X 


X 




X 


Mental 

Health 

Residential 










X 


X 




X 


X 








X 






VI 

'Z 

u 






X 




X 


X 






X 








X 






~ 0) 






X 












X 




X 








X 


01 ij 


X 


X 


X 


c 

1 

c 
c 
D 


X 


X 




X 


X 


c 

1 

c 

c 
D 


X 


X 


X 


c 

o 

c 

c 
D 


X 


£ 

a. 


1 


c 


1 

'C 

i_ o 

.2 -5 
t S 


u 
< u 


a. 

Z 

y 


Vi 

c 


Medi-Cal 
Specialty Mental 
Health Services 
Consolidation 


"55 

•§ 
Z 

c 

1 


o o 


■s 

n 
B 

c 

z 


Integrated Care 
and Financing 
Pilot Project 


w 

3 

u 

u 

u < 


GA Behavioral 
Health Managed 
Care Program 


Diamond State 
Health Plan 


c 
0) o 

t. -{3 

01 O 

1 c 

;? E 


z 

to 

u 

tn 
I 


0) 
■w 


£ 

XI 
< 


< 


c 
o 

N 

< 


rO 

c 
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< 


03 

'c 

■(5 
U 


o 

1 
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3 
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u 

(U 

c 
c 
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u 


<u 


"o «l 

w XI 

•5 i 

.t2 O 

Q U 



32 



{SAMHSA} Managed Care Tracking System 



Q 

Z 

i- 

z 
o 
u, 

00 

0> 
0^ 



en 

>] 

3 



O 
O 

CU 
< 

u 

Q 
uu 
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09 



Residential 
Substance 

Abuse 
Treatment 
Programs 


















X 


X 








X 




X 




Opiate 
Treatment 
Programs 












X 








X 








X 








c 
o 

■5 

u 

1= 

g 

Q 












X 






X 


X 


X 


X 




X 




X 


X 


Outpatient 

Substance 

Abuse 

Services 












X 






X 


X 


X 


X 




X 




X 


X 


Mental 
Health 
Support 


X 










X 












X 


X 




X 




X 


Mental 

Health 

Rehabilitation 


X 










X 






X 


X 


X 


X 










X 


Mental 

Health 

Outpatient 


X 










X 






X 


X 


X 


X 


X 




X 




X 


Mental 

Health 

Residential 
























X 


X 




X 






'35 

'C 












X 










X 


X 


X 








X 


«1 


X 










X 






X 


X 
















1 Jl 


X 


c 

1 

c 
c 
D 


c 



c 
c 
D 


X 


< 

Z 


X 


c 

? 



c 

c 
D 


< 

z 


X 


X 


X 


X 


X 




X 




X 


E 
S 

a. 


a. 

X 

z 

Q. 


Department of 
Children and 
Families 


c 

(3 


Behavioral Healtl 
Care Utilization 
Management 
Service 



1/) 
< 

CO 


Hawaii 
QUEST/CCS 


1 

as 


il 

s 

2 < 


u 
S-o 

4; JZ 

a: u 


Q 
a. 

X 
X 


c 
a. 

II 


u 

<u 



CL 

c 
Q 


a. 
< 

X 


0. 

in 
Z 


e 

a. 

& 

c 
3 

U 


Alcohol and 
Drug Managed 
Care Model 


c 


1 

> 

1. 

a. 

U 


State 


-<a 


li- 






(1) 


I 







c 


C 
« 

XI 


_o 


1/1 

c 



July 31, 1998 



33 



Residential 
Substance 

Abuse 
Treatment 
Programs 










X 


X 




X 










X 


X 








X 




X 




X 


Opiate 
Treatment 
Programs 










X 


X 




X 






X 


X 


X 


X 


X 














X 


c 



g 

0) 

Q 


X 


X 






X 


X 
































X 


Outpatient 

Substance 

Abuse 

Services 










X 


X 




X 


X 




X 


X 


X 


X 


X 






X 




X 


X 


X 


Mental 
Health 
Support 












X 




X 






X 




X 


X 


X 








X 






X 


Mental 

Health 

Rehabilitation 


X 










X 




X 






X 


X 


X 


X 


X 




X 




X 


X 




X 


Mental 

Health 

Outpatient 


X 




X 




X 


X 


X 


X 


X 


X 


X 


X 


X 


X 


X 




X 


X 


X 


X 


X 


X 


Mental 

Health 

Residential 












X 




X 






















X 


X 




X 


u 




X 


X 






X 




X 






















X 


X 




X 


Ul 


X 










X 












X 


X 


X 












X 




X 


Inpatient 
Services 


X 

Vi 

< 


c .s- 
u -p 
i 1 


X 

o 

ei: 


< 

z 


X 

m 
w 




X 




X 






X 


X 




X 


X 


< 

z 


X 




X 


X 




X 


E 

o 

a. 


1 

X 


1 

1 ^ 

i s 

U X 


r 


u. 

z 



z 

X 


a. 
< 

z 

Q. 




X 
trt 

z 


u. 

u 


u 

Q 


c 

c 

z 


-« r- z 


i. 


+ 



x» 


1 


a. 


ll< 


15 

^ i 

u a. 
^ S 


it 

^ 1 

(31 X 


1 


u 

3 

c 


C 
"to 



_l 


c 

z 


XI 

c 
n 

>^ 

i- 
n 


2 

(/^ 

3 


rJ 

z 


c 

rj 

.00 


Z 


10 
(U 

c 
c 

Z 


■q. 
9. 

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(/> 

z 


3 



(/) 
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Z 


CO 

c 

s 

c 



Z 


A 
in 

XI 

<u 

Z 



34 



{SAMHSA} Managed Care Tracking System 



^ 



Residential 
Substance 

Abuse 
Treatment 
Programs 








X 






























X 






Opiate 
Treatment 
Programs 








X 














X 


X 






X 








X 






c 
o 

u 

1 
Q 








X 




X 






X 




X 






X 






X 


X 




X 




Outpatient 

Substance 

Abuse 

Services 




X 




X 


X 


X 






X 


X 


X 






X 


X 




X 


X 


X 






Mental 
Health 
Support 












X 












X 






X 














Mental 

Health 

Rehabilitation 










X 


X 








X 








X 


X 




X 


X 








Mental 

Health 

Outpatient 










X 


X 


X 




X 


X 


X 


X 




X 


X 


X 


X 


X 


X 






Mental 

Health 

Residential 




X 




























X 


X 




X 






*iJi 

o 












X 






X 






X 




X 


X 




X 










z t 


















X 












X 














1^ 


< 

Z 


X 


< 
z 


X 


X 


X 


X 


c 

o 

c 

c 
D 


X 


X 


X 


X 


< 

z 


X 


X 




X 


X 






< 

Z 


E 

k. 

M 
O 

L. 


i 


New Hampshire 
Managed Care 


Q 

X 

z 

D 
X 

Z 


Q 
U 


Q 


c 

i. 

a. 

u 

(2 


i X 


•♦3 


1 E 
< 


o 

z 


6 


1 

< 


a. 


§ 

o 
1/) 


a. 

X 




Children's 
Intensive Mental 
Health Treatment 
Services 


CO 

X 
CO 
U 
X 


o 
z 

X 

5 e 

3 C 

1(3 


fa 

u 


c 
o 


s 

u 

a: 


State 


> 

z 


El 

Z I 


CO 

i- 

Z 


o 

u 
X 

<u 

Z 

? 

Z 


u 

z 


o !5 

z u 


1 

ro 

Q 
o 

z 


o 

Jc 



ro 

E 
o 

o 


c 

s, 

1- 

o 


C 
ro 
_> 
>v 

C 

c 

.2: 


XI 

c 

i<0 

(1) 

o 



July 31, 1998 



3S 



•5 g 

s 



e 

V 

u 



^ ki 



1^ E 

O 9J 
F 



X 



X 



X 



V 



Q, VI 

3 3 



ui U 
I '^ 



X 



X 



X 



£ Z 



X 



c A 
0) « 

Z Z 



X 



X 



X 



C (4 
0) 01 

£ Z 



X 



X 



X 



rt -s 

e (« 

U 0) 

Z Z 



X 



X 



X 



u 



X 



o 

z 



4) u 



X 



X 



X 



> a. 








■n a> 

S .2; 

Il 



« J 

.•P JS «^ .£ 

g 3 W iO 

r y ,<^ 3 

CL O. *J U. 



36 



{SAMHSA} Managed Care Tracking System 



c 

01 V 

^ E 

< 4) 



X 



4) 0) 



Q. 

o 



X 



X 



X 



X 



X 



X 



X 



I ^ 

& </> 

3 3 

o *« 



V) u 



X 



X 



c (d 

T. I 



X 



X 



X 



■a 

01 

■a 






X 



X 



X 



c <« 
Z X 



X 



T3 

o 

c 

C 

o 

c 
o 



Z X 



X 






X 



X 



X 



£ 

■D 



o 

z 



X 



(N 



X 



X 



X 



X 



X 



< 

z 



c u 



c 
o 

to 

c 



X 

•g 

c 
<u 






c 



o 

X 



I 



I 

0. 



Ui 



c 
"5b 



I/) 



I- 



July 31, 1998 



37 



Table 10. Eligible Populations in Managed Behavioral Health Care Programs — July 31, 1998 



State 


Program 


AFDO 
TANF 


SSI 

or 

ABD 


Expanded 
Medicaid 


General 
Assistance 


Expanded 
Women 

and 
Children 


Clinical 
Criteria 


Dually 

Eligible 

Medicaid/ 

Medicare 


Alabama 


BAY 


X 


X 






X 






Alaska 


Prior authorization 


N/A 














Arizona 


AHCCCS Carve-out 


X 


X 






X 






ICMP* 












C 




Arkansas 


Benefit Arkansas 


C 














California 


Medi-Cal Specialty Mental 
Health Services Consolidation 


X 


X 








X 




Two-Plan Model 


Unknown 














Short-Doyle Program* 


X 


X 












Colorado 


Mental Health 


X 


X 






X 






Integrated Care and 
Financing Pilot Project 














X 


Connecticut 


Conneaicut Access 


X 


X 






X 






GA Behavioral Health 
Managed Care Program* 








X 








Delaware 


Diamond State Health Plan 


X 


X 






X 






Child Welfare Demonstration* 












c 




District 
of Columbia 


HSCSN 




c 












Florida 


PMHP 


X 


X 






X 






Department of Children 
and Families* 


c 


c 






c 






Caprtatipn Plan* 


Unknown 














Behavioral Health Care 
Utilization Management 
Service 


N/A 














Georgia 


CSB/ASO* 












X 




Hawaii 


Hawaii QUEST/CCS 


X 


X 


X 


X 


X 


X 




Children's Demonstration* 












X 




Idaho 


Idaho Substance Abuse 

Services* 


N/A 














Illinois 


Responsible Choice** 


X 






c 








Indiana 


HHPD** 




X 












Hoosier Assurance Plan* 


X 


X 


X 




X 






Dawn Project* 




X 












Iowa 


MHAP 


X 


X 






X 






IMSACP 


X 


X 






X 






County Program* 












A 




Kansas 


Alcohol and Drug Managed 
Care Model* 




X 












CFS Privatization* 


c 










C 




Kentucky 


Access 


X 


X 






X 






Health Care Partnerships 


X 


X 






X 






Louisiana 


Pilot 


X 














Maine 


N/A 
















Maryland 


HealthChoice 


X 


X 


X 




X 






Massachusetts 


MassHealth*** 


X 


X 


X 




X 


i< 





38 



{SAMHSA} Managed Care Tracking System 



Table 10. Eligible Populations in Managed Behavioral Health Care Programs — ^July 31, 1998 (continued) 



State 


Program 


AFDO 
TANF 


SSI 

or 

ABD 


Expanded 
Medicaid 


General 
Assistance 


Expanded 
Women 

and 
Children 


Clinical 
Criteria 


Dually 

Eligible 

Medicaid 

Medicare 


Michigan 


Comprehensive Health Plan 


X 


X 






X 






MSSP*** 


A 


A 








A 


X 


MIFPI 










C 






Voluntary HMO** 


X 


X 












Minnesota 


PMAP 


X 














MSHO 












A 


A 


CCDTF 


X 


X 


X 




X 






MinnesotaCare*** 






X 


X 


X 






General Assistance Medical 
Care Managed Care* 








X 








Mississippi 


N/A 
















Missouri 


Managed Care + 


X 


X 






X 






CSTAR* 












X 




Montana 


MHAP*** 


X 


X 




X 


X 


X 




Nebraska 


Nebraska Health 
Connection MH/SA 


X 


X 






X 






Medical/Surgical Component 


X 


X 






X 






Behavioral Health Redesign* 


X 




X 










Nevada 


N/A 
















New 
Hampshire 


New Hampshire Managed 
Care** 












X 




NHDMHDS* 












X 




New Jersey 


MCCD 












X 




New Mexico 


SALUD 


X 


X 






X 






New York 


Partnership Plan 


X 






X 








Prepaid Mental Health Plan* 


X 














County Demonstration* 












X 




North Carolina 


Carolina Alternatives 


c 


C 






c 






North Dakota 


NoDAC 


X 














Ohio 


OhioCare 


X 














Accessing Better Care** 




X 












URIP 


N/A 














Oklahoma 


SoonerCare 


X 














Oregon 


OHP 


X 


X 




X 


X 


X 




Children's Intensive Mental 
Health Treatment Services* 










c 


c 




Pennsylvania 


HCBHS 


X 


X 




X 


X 






Voluntary HMO Contracts** 


X 


X 




X 




X 




Rhode Island 


RIteCare 


X 








X 






Detoxification Services* 






X 










RlCover* 












X 




South 
Carolina 


Voluntary HMO Program** 


X 


X 






X 






Child VVelfare Privatization 
Initiative* 












X 




Prior authorization 


X 














South Dakota 


PRIME 


X 


X 






X 






CARE program* 












A 





July 31, 1998 



39 



Table 10. Eligible Populations in Managed Behavioral Health Care Programs — July 31, 1998 (continued) 



State 


Program 


AFDO 
TANF 


SSI 

or 

ABD 


Expanded 
Medicaid 


General 
Assistance 


Expanded 
Women 

and 
Children 


Clinical 
Criteria 


Dually 

Eligible 

Medicaid 

Medicare 


Tennessee 


TennCare Partners 


X 


X 






X 


X 




MHM Correctional 
Services, Inc.* 












A 




Texas 


STAR 


X 


X 






X 






NorthSTAR*** 


X 


X 






X 






Texas Integrated Funding 
Initiative* 












X 




Utah 


PMHP 


X 


X 






X 


X 




Vermont 


VHAP 


X 


X 






X 




X 


DDMHS Restruauring* 












X 




Virginia 


Medallion II 


X 


X 












Priority Populations and 
Case Rate Funding Pilot* 






X 










Washington 


Integrated Community 
Mental Health Program 


X 


X 






X 






Basic Health Plan* 


X 


X 












West Virginia 


New Directions in Medicaid 
Services Initiative 


X 


X 




X 








Wisconsin 


Medicaid HMO Program 


X 








X 




X 


BadgerCare 


Unknown 














CCF** 


C 














WAM** 


c 














l-Care** 




X 










X 


Wl Partnership** 




A 










X 


PACE** 




A 










X 


Wyoming 


N/A 
















Total 




57 


48 


9 


II 


38 


28 


8 


* Non-Medicaid Programs. ** Voluntary Programs. ***Both Medicaid and Non-Medicaid Programs (i.e., "piggybacked" programs). 
A = Adults. C = Children. X = Adults and Children. 

1. AFDC/TANF = Aid to Families with Dependent Children/Temporary Assistance for Needy Families. 

2. SSI = Supplemental Security Income. 

3. ABD = Aged, Blind, Disabled. 



40 



{SAMHSA} Managed Care Tracking System 



Table 1 1 . Lead Agencies for Public Sector Managed Behavioral Health Care Programs — July 3 1 , 1 998 



State 


Program 


Medicaid 


Mental 

Health 

Authority 


Substance 

Abuse 
Authority 


Agency 
Partnership 


Alabama 


BAY 


X 








Alaska 


Prior authorization 


X 








Arizona 


AHCCCS Carve-out 


X 








ICMP 




X 






Arkansas 


Benefit Arkansas 








Medicaid + MH 


California 


Medi-Cal Specialty Mental 
Health Services Consolidation 




X 






Two-Plan Model 


X 








Short-Doyle Program 




X 






Colorado 


Mental Heal^ 




X 






Integrated Care and Financing 
Pilot Project 


X 








Connecticut 


Connecticut Access 


X 








GA Behavioral Health Managed 
Care Program 








MH + SA 


Delaware 


Diamond State Health Plan 


X 








Child Welfare Demonstration 




X 






District of 
Columbia 


HSCSN 


X 








Florida 


PMHP 


X 








Department of Children 
and Families 








MH + SA 


Capitation Plan 


Unknown 








Behavtoral Health Care 
Utilization Management Service 


X 








Georgia 


CSB/ASO 








MH + SA 


Hawaii 


Hawaii QUEST/CCS 


X 








Children's Demonstration 


X 








Idaho 


Idaho Substance Abuse Services 








Medicaid + SA 


Illinois 


Responsible Choice 


X 








Indiana 


HPPD 


X 








Hoosier Assurance Plan 




X 






Dawn Project 








MH + County + 
Education Department 


Iowa 


MHAP 








Medicaid + MH 


IMSACP 








Medicaid + SA 


County Program 








Non-profit Organizations 


Kansas 


Alcohol and Drug Managed 
Ore Model 








Medicaid + SA 


CFS Privatization 








Medicaid + MH 


Kentucky 


Access 


X 








Health Care Partnerships 


X 








Louisiana 


Pilot 


X 








Maine 


N/A 










Maryland 


HealthChoice 


X' 


X' 






Massachusetts 


MassHealth 


X 








Michigan 


Comprehensive Health Plan 


X 








MSSP 








Medicaid + MH + SA 


MIFPI 


X 








Voluntary HMO 


X 









July 31, 1998 



41 



Table 1 1 . Lead Agencies for Public Sector Managed Behavioral Health Care Programs — July 3i, 1998 

(continued) 



State 


Program 


Medicaid 


Mental 

Health 

Authority 


Substance 

Abuse 
Authority 


Agency 
Partnership 


Minnesota 


PMAP 


X 








MSHO 








Medicaid + Aging 


CCDTF 








Medicaid + SA 


MinnesotaCare 


X 








General Assistance Medical 
Care Majiaged Care 


X 








Mississippi 


N/A 










Missouri 


Managed Care + 


X 








cstar 








Medicaid + MH 


Montana 


MHAP 








Medicaid + MH 


Nebraska 


Nebraska Health Connection 
MH/SA 








Medicaid + MH + SA 


Medical/Surgical Component 


X 








Behavioral Health Redesi^ 








Medicaid + MH + SA 


Nevada 


N/A 










New 
Hampshire 


New Hampshire Managed Care 


X 








NHDMHDS 




X 






New Jersey 


MCCD 






X 




New Mexico 


SALUD! 


X 








New York 


Partnership Plan 








Medicaid + MH 


Prepaid Mental Health Plan 




X 






County Demonstration 






X 




North Carolina 


Carolina Alternatives 


X 








North Dakota 


NoDAC 


X 








Ohio 


OhioCare 


X 








Accessing Better Care 


X 








URIP 


X 








Oklahoma 


SoonerCare 


X 








Oregon 


OHP 








Medicaid + MH + SA 


Children's Intensive Mental 
Health Treatment Services 




X 






Pennsylvania 


HCBHS 








MH + SA 


Voluntary HMO Contracts 


X 








Rhode Island 


RIteCare 


X 








Detoxification Services 






X 




RICover 




X 






South Carolina 


Voluntary HMO Program 


X 








Child Welfare Privatization 
Initiative 


X 








Prior authorization 






X 




South Dakota 


PRIME 


X 








CARE program 




X 






Tennessee 


TennCare Partners 


X 








MHM Correctional Services, Inc. 








Department of Corrections 


Texas 


STAR 


X 








NorthSTAR 








MH + SA 


Texas Integrated Funding 
Initiative 


Unknown 









42 



{SAMHSA} Managed Care Tracking System 



Table 1 1 . Lead Agencies for Public Sector Managed Behavioral Health Care Programs — ^July 3 1 , 1 998 
(continued) 



State 


Program 


Medicaid 


Mental 

Health 

Authority 


Substance 

Abuse 
Authority 


Agency 
Partnership 


Utah 


PMHP 


X 








Vermont 


VHAP 


X 








DDMHS Restructuring 




X 






Virginia 


Medallion II 


X 








Priority Populattons and Case 
Rate Funding Pilot 








MH + SA 


Washington 


Integrated Community Mental 
Health Program 




X 






Basic Heaftfi Plan 


Unknov^n 








West Virginia 


New Directions in Medicaid 
Services Initiative 


X 








Wisconsin 


Medicaid HMO Program 


X 








BadgerCare 


X 








CCF 


X 








WAM 


X 








l-Care 


Unknown 








Wl Partnership 


Unknown 








PACE 


Unknown 








Wyoming 


N/A 










Total 




50 


14 


4 


24 


MM = Mental Health. SA = Substance Abuse. 

' The Medicaid Agency is responsible for substance abuse and primary mental health services; the Mental Health Authority is responsi- 
ble for specialty mental health services covered under the partial carve-out. 



July 31, 1998 



43 



Table 12. Welfare Reform and Substance Abuse Treatment — July 31, 1998 



State 


Provisions for 

Drug Testing 

inTANF 


Provisions to Opt Out of 
Federal Requirements 

Denying TANF to 
Convicted Drug Felons 


Provisions for MH and SA 

Treatment in 

Welfare-to-Work Plan 


Alabama 


No 


No 


N/A 


Alaska 


No 


Yes 


N/A 


Arizona 


No 


No 


N/A 


Arkansas 


No 


No 


N/A 


California 


No 


No 


Yes 


Colorado 


No 


Yes' 


N/A 


Connecticut 


No 


Yes 


N/A 


Delaware 


No 


No 


Yes 


District of Columbia 


No 


No 


N/A 


Florida 


No 


Yes^ 


N/A 


Georgia 


No 


No 


Yes 


Hawaii 


No 


Yes 


Yes 


Idaho 


No 


No 


Unknown 


Illinois 


No 


No 


Unknown 


Indiana 


No 


No 


N/A 


Iowa 


No 


Yes' 


N/A 


Louisiana 


No' 


No 


No 


Kansas 


Yes^ 


No 


No 


Kentucky 


No 


No 


No 


Maine 


No 


No 


N/A 


Maryland 


No 


No 


Yes 


Massachusetts 


No 


No 


No 


Michigan 


No 


Yes^ 


Yes 


Minnesota 


Yes 


Yes 


Yes 


Mississippi 


No 


No 


N/A 


Missouri 


No 


No 


Unknown 


Montana 


No 


No 


N/A 


Nebraska 


No 


No 


Yes 


Nevada 


Yes 


No 


Yes 


New Hampshire 


No 


Yes 


No 


New Jersey 


No 


No 


N/A 


New Mexico 


No 


No 


N/A 


New York 


Yes' 


Yes 


N/A 


North Carolina 


Yes 


No 


N/A 


North Dakota 


No 


No 


N/A 


Ohio 


Yes^ 


No 


Yes" 


Oklahoma 


No 


No 


N/A 


Oregon 


No 


No 


N/A 


Pennsylvania 


Yes 


No 


N/A 


Rhode Island 


Yes 


No 


Yes 


South Carolina 


Yes 


No 


Yes 


South Dakota 


No 


No 


Yes 


Tennessee 


No 


No 


No 


Texas 


No 


No 


N/A 



44 



{SAMHSA} Managed Care Tracking System 



Table 12. Welfare Reform and Substance Abuse Treatment — July 3i, 1998 (continued) 



State 


Provisions for 

Drug Testing 

inTANF 


Provisions to Opt Out of 
Federal Requirements 

Denying TANF to 
Convicted Drug Felons 


Provisions for MH and SA 

Treatment in 

Welfare-to-Work Plan 


Utah 


No 


Yes' 


N/A 


Vermont 


No 


Yes 


N/A 


Virginia 


No 


No 


N/A 


Washington 


No 


Yes'" 


N/A 


West Virginia 


No 


No 


N/A 


Wisconsin 


Legislation pending 


No 


N/A 


Wyoming 


No 


Yes 


N/A 


' Benefits will continue to be provided only if individual is in rehabilitation. 

^ Except drug traffickers. 

' State is in planning stages to test for drug use. 

■• State will screen all applicants for substance abuse and will refer clients for more extensive testing, if necessary. A drug test may be 

administered as part of the expanded testing. 
* Benefits must be paid through a third-party payor contingent upon the individual meeting parole requirements. 
' State conducts mandatory drug assessment for all applicants and recipients upon recertification.The assessment may include a 

drug test. 
' For certain pregnant Medicaid recipients. 

" Ohio declined Welfare-to-Work (WtW) funds after its WtW plan was approved. 

' State requires drug felons to receive treatment and makes progress as a condition for receiving benefits. 
'"State will provide benefits to drug felons with certain limitations. 

MH = Mental Health. SA = Substance Abuse. TAN F = Temporary Assistance for Needy Families. N/A = Not Applicable. 



July 31, 1998 



45 



Table 13. Dimensions of Managed Behavioral Health Care Evaluations — July 31, 1998 



State 


Cost 


Outcomes 


Access 


Alabama 


X 


X 


X 


Alaska 




N/A 




Arizona 




X 




Arkansas 




X 




California 




X 


X 


Colorado 


X 






Connecticut 


X 


X 


X 


Delaware 




X 


X 


District of Columbia 


X 


X 


X 


Florida 


X 


X 


X 


Georgia 




N/A 




Hawaii 




X 


X 


Idaho 




N/A 




Illinois 






X 


Indiana 


X 






Iowa 




X 


X 


Louisiana 


X 






Kansas 




X 




Kentucky 


X 


X 


X 


Maine 




N/A 




Maryland 




X 


X 


Massachusetts 


X 


X 


X 


Michigan 


X 


X 


X 


Minnesota 


X 


X 


X 


Mississippi 




N/A 




Missouri 




Unknown 




Montana 




Unknown 




Nebraska 




X 


X 


Nevada 




N/A 




New Hampshire 


Reporting anc 


i continuous quality improvement reports required. 


New Jersey 




X 


X 


New Mexico 




In process 




New York 


X 


X 




North Carolina 


X 


X 


X 


North Dakota 




N/A 




Ohio 




X 


X 


Oklahoma 




X 


X 


Oregon 


X 


X 


X 


Pennsylvania 


X 


X 


X 


Rhode Island 


X 


X 


X 


South Carolina 


X 


X 


X 


South Dakota 




X 


X 


Tennessee 


X 


X 


X 


Texas 




X 


X 


Utah 


X 


X 


X 


Vermont 


X 


X 


X 


Virginia 




X 


X 


Washington 


X 


X 


X 


West Virginia 




Unknown 




Wisconsin 




Unknown 




Wyoming 




N/A 




Total 


20 


33 


31 


NA = Not Applicable. 





46 



{SAMHSA} Managed Care Tracking System 



ALABAMA 



OVERVIEW 




Medicaid-funded behavioral health services remain in the fee-for-service system in Alabama, except 
in Mobile County, in that county, the Better Access for You (BAY) Health Plan integrates behavioral 
health into a primary care model and provides all of the mandatory Medicaid benefits without copay- 
ments, deductibles, or cost sharing. 

Although a statewide managed care strategy for behavioral health has not been adopted, State 
officials are considering a major mental health reform effort that would embrace some managed care 
concepts. 



Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 

Section 1115- BAY - general health - integrated: Physical health, mental health, and substance abuse 

services are integrated into general managed health care services. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 
Not applicable. 



Geographic Location 



Section iH5 - BAY: Mobile County only. 



Status of Programs 



Section iiiS - BAY. Waiver submitted: Date not avail- 
able. Waiver approved: December 6, 1996. Waiver 
implemented: May 1, 1997. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Crisis,- outpatient (e.g., individual, group, and fami- 
ly counseling and therapy). 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Inpatient; outpatient (e.g., clinic services),- mental 
health rehabilitation (e.g., targeted case manage- 
ment, psychiatric rehabilitation),- Institution for 
Mental Diseases (IMD) services for individuals age 
65 and over and age 21 and under,- prescription 
dmgs. Per Omnibus Budget Reconciliation Act 



(OBRA) 90, all dmgs with a valid rebate agreement 
with the Health Care Financing Administration 
(HCFA) are covered by the State. 

Medicaid Substance Abuse Services in 
Managed Care Plan 



Section Hi5 -BAY-. Crisis,- outpatient (e.g., individual, 
group, and family counseling and therapy). 

Medicaid Mental Health Services in 
Managed Care Plan 



Section ms - BAY. Inpatient,- outpatient (e.g., clinic 
services); mental health rehabilitation (e.g., targeted 
case management, psychiatric rehabilitation); IMD 
services for individuals age 65 and over and age 2 ] 
and under; prescription dmgs. Per OBRA 90, all 
dmgs with a valid rebate agreement with HCFA are 
covered by the State. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 



Not applicable. 



July 31, 1998 



47 



Non-Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section ms - BM^-. Early and periodic screening, 
diagnosis, and treatment (EPSDT). 

Populations Covered Under Managed 
Behavioral Health 

Section Hi5 - BAY: Children and adults mandatory: 
Aid to Families with Dependent Children/ 
Temporary Assistance for Needy Families 
(AFDC/TANF), Seventh Omnibus Budget 
Reconciliation Act (SOBRA), Supplemental 
Security Income, optional expansion for pregnant 
women and children, uninsured and underinsured. 
BAY eligibles follow the same criteria for fee-for-ser- 
vice except for extended family planning. This 
extends family planning coverage for 2 years past 
delivery for SOBRA adults (133 percent Federal 
poverty level (FPL)). Children's Health insurance 
Program (CF41P) children age 15 through 18 are 
covered in BAY (up to 100 percent FPL). 

State Managed Care Progrann 
Administration 



Section 1H5 - BAY: The Medicaid agency contracts 
with a federally qualified nonprofit health mainte- 
nance organization (HMO). The HMO subcon- 
tracts all behavioral health services to a local public 
mental health center, which provides all mental 
health services for BAY Health Plan enrollees. The 
Department of Public Health provides oversight 
over Mobile Mental Health, a community mental 
health center. All community mental health 
providers covered by Medicaid participate. Other 
mental health providers, e.g., psychiatrists and sub- 
stance abuse service providers, may participate if 
they are traditional providers following the 80/20 
standard. 

Financing of Plans 



mental health services. The HMO contracts with 
Mobile Mental Health on a capitated basis. Mobile 
Mental Health is at full risk. The capitation rate was 
determined by historical expenditures. The State's 
anticipated savings is 3 percent of its projected bud- 
get neutrality cap. Providers are paid on a fee-for- 
service basis. 

Coordination Between Primary and 
Behavioral Health Care 



Section iH5 - BAY: Coordination of services is pro- 
vided by the HMO, which refers patients to mental 
health services in Mobile County. 

Consumer^Family Involvement 



Section ms - BAY: Consumers were involved in the 
development of the 1115 waiver, and there is con- 
sumer oversight for BAY Health Plan. Consumers 
are on the community advising committee. 

Future Plans 

Section ms - BAY: None. 

State Agency Administration 



Medicaid is a single State agency. The mental 
health and substance abuse authorities are under the 
Department of Mental Health and Mental 
Retardation. 

Welfare Reform 

Alabama's welfare reform program denies TANF 
benefits to drug felons, but does not test recipients 
for drug use. 

County 

Not applicable. 

Evaluation Findings 



Section liis - BAY: BAY is financed through Medicaid 
dollars. The HMO bears risk up to a $600,000 stop- 
loss and is paid a capitated rate, which includes 



Currently, studies on the impact of managed care 
on cost, quality, and access with regard to the pilot 
in Mobile are under review by an external review 
entity. 

Other Quantitative Data 

Not applicable. 



48 



{SAMHSA} Managed Care Tracking System 



ALASKA 



OVERVIEW 




Alaska does not have a full-scale, at-risk managed behavioral health care program,- behavioral health services 
remain in the fee-for-service system. However, the Division of Medical Assistance (DMA), within the 
Department of Health and Human Services (DHHS), is in contract negotiation phase for a prior authoriza- 
tion program covering inpatient and clinic-based mental health rehabilitation services. This contract was 
awarded to a peer review organization (PRO) in August 1997 but currently is suspended. 

Managed Care Programs for Behavioral Health Services 

I Medicaid Waivers 
Not applicable. 

I Medicaid Voluntary 
Not applicable. 

II Other Managed Care Programs 
I Prior Authorization Program - mental health stand-alone: Medicaid progrann. 



Geographic Location 

Prior Authorization Program: Statewide. 

Status of Programs 



Prior Authorization Program: Prior authorization of out- 
patient mental health rehabilitation services 
remains suspended with plans to re-implement on 
November 1, 1998. The PRO is currently prior- 
authorizing inpatient care in psychiatric hospitals 
and residential psychiatric treatment centers. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Crisis, opiate treatment (e.g., methadone mainte- 
nance therapy,- only when chemical dependency is 
a secondary diagnosis), detoxification (e.g., acute 
and subacute), rehabilitation (e.g., assessment/diag- 
nosis), outpatient. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 



Inpatient, outpatient (e.g., partial hospitalization, 
clinic services), mental health support, rehabilita- 
tion (e.g., assessment/diagnosis), crisis, residential 



(e.g., residential psychiatric treatment facilities), 
Institution for Mental Diseases services (individuals 
age 65 and over, age 21 and under). 

Medicaid Substance Abuse Services in 
Managed Care Plan 



Prior Authorization Program: Not applicable. 

Medicaid Mental Health Services in 
Managed Care Plan 

Prior Authorization Program: Inpatient, rehabilitation. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Prior Authorization Program: Not applicable. 



July 31, 1998 



49 



Populations Covered Under Managed 
Behavioral Health 



State Agency Administration 



Prior Authorization Program: Not applicable. 

State Managed Care Program 
Administration 

Prior Authorization Program: DMA contracts with a 
PRO to conduct prior authorization functions. The 
PRO is responsible for training providers in prior 
authorization process and procedures, responding 
to requests from provider for prior authorization of 
services, and notifying provider and client of 
approval or denial and reconsideration of denial 
upon request. 

Financing of Plans 

Prior Authorization Program: The behavioral health 
managed care organization is paid a set fee for these 
services. 

Coordination Between Primary and 
Behavioral Health Care 

Not applicable. 

Consumer-Family Involvement 

Prior Authorization Program: Consumers and families 
were not involved in the design or drafting of the 
request for proposal (RFP), but the RFP was based 
on models from other states where consumers and 
families were involved in the design. 

Future Plans 



Prior Authorization Program: See Status of Programs 
Section. 

* New Program Under Development: The Alaska 
DMA is participating with other DHHS divisions 
in reviewing a concept for delivery of mental health 
services that is centered around a care coordinator 
function. Under this concept, a care coordinator 
would be paid to arrange for and purchase, or 
approve for purchase, services to meet the needs 
of clients. Care coordination would be a paid 
Medicaid service separate from treatment and eval- 
uation services. This function would potentially 
apply to other State program services and 
Medicaid-funded services. 



DHHS houses Medicaid, Mental Health, and 
Substance Abuse divisions. Medicaid falls under 
DMA; Mental Health under the Division of Mental 
Health and Developmental Disabilities,- and 
Substance Abuse under the Division of Alcoholism 
and Drug Abuse. 

Welfare Reform 

Alaska has no welfare reform waiver applications 
pending or approved at this time. Under Alaska's 
Temporary Assistance for Needy Families (TANF) 
block grant, drug testing will not be mandatory for 
TANF beneficiaries, and beneficiaries who are con- 
victed of drug felonies will not be denied coverage 
per se, but instead will be covered under a State pro- 
gram. This State program, Alaska Temporary 
Assistance Program, which uses only State funds, 
covers services needed to accomplish assigned 
activities and attain self-sufficiency. This program 
includes procedures (e.g., screenings) for referring 
clients to mental health and substance abuse 
providers. 

Additionally, during Fall 1998, a demonstration 
project will begin in the Mat-Su Borough, a rural/ 
suburban area of 22,909 square miles where about 
60,000 Alaskans live. The project activities, involv- 
ing collaboration among the nonprofit substance 
abuse treatment agency, the public assistance office, 
and the work search contractor, will provide screen- 
ing, assessment, and treatment of temporary assis- 
tance clients. These services are in addition to the 
customary services such as case management and 
work search support. The policy goal of the project 
is to develop an effective collaborative model to 
assist clients with substance abuse problems and 
help them obtain and maintain employment. The 
experience of this project will be used to plan the 
replication of similar activities across the state. 

County 

Not applicable. 

Evaluation Findings 

Not applicable. 

Other Quantitative Data 

Not applicable. 



so 



{SAMHSA} Managed Care Tracking System 



ARIZONA 



OVERVIEW 

The Arizona Health Care Cost Containment System (AHCCCS) is Arizona's Medicaid program and 
the State's health care program for persons who do not qualify for Medicaid. AHCCCS has three 
components: 

• An integrated system for individuals age 18—20 who do not have serious mental illness 
(SMI) or severe emotional disturbance (SED) (acute care health plans),- 

• A behavioral health "carve-out" (Regional Behavioral Health Authorities — RBHAs) for 
children age 17 and under, all SMI adults over age 18, and adults age 21 and older,- and 

• A carve-in, long-term care system (Arizona Long-Term Care System — ALTCS) that offers 
acute medical care services, institutional services, and home- and community-based 
services to the elderly and physically disabled population. 

The majority of Medicaid managed care members are served in the acute care system. 

in response to a Children's Behavioral Health Intergovernmental Agreement (IGA), five agencies 
with intersecting responsibilities for children have come together to form an interagency case man- 
agement project in two counties. This project is part of a larger effort to improve the behavioral 
health care delivery system for children. 

Managed Care Programs for Behavioral Health Services 




Medicaid Waivers 

Section 1115 -AHCCCS: integrated and carve-out Acute mental health and substance abuse services 
integrated for a non-SMI, non-SED population age 1 8-20; mental health and substance abuse services 
carved out for all other populations; long-term care services carved in for elderly or physically dis- 
abled population. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 
Seaion 1 1 15 -AHCCCS: 

RBHAs - carve-out RBHAs, managed care entities, serve State-funded populations: SMI adults who are 
not Medicaid-eligible and non-Medicaid pregnant women who have substance abuse problems. 
interagency Case Management Project (/CA1P)-integrated:Through an IGA between the Departments of 
Health Services, Economic Security, Education, juvenile Corrections, and the Administradve Office of 
the Courts, a 5-year project has been developed and implemented to centralize and coordinate uti- 
lization of publicly administered services and funds for children involved in multiple public service 
agencies such as child welfare, behavioral health, education, and/or the juvenile justice system. This 
project is part of a larger effort to improve the behavioral health care delivery system for children 
through the Children's Behavioral Health IGA. 



Geographic Location 

""■"■""^ ....,,.:.::.......:.::,..,,:,., _„,^,,,,,,^,,,,,,^:, , ,^,—,,,,^^ ^ ^^^^^ RBHAs (carvc-Qut): Statcwidc. 

Section ms - AHCCCS: ALTCS (long-temi care): Statewide. 

Acute care health plans (for individuals age 18-20 ICMP: One urban county (Maricopa),- one rural 

non-SMI, non-SED): Statewide. county (Mojave). 



July 31, 1998 SI 



Status of Programs 

Section ms - AHCCCS: 

Acute care health plans (for non-SMI, non-SED 
individuals age 18-20): Approved July 13, 1982,- 
implemented October 1982 for acute medical care 
(included 72 hours of psychiatric emergency inpa- 
tient care per episode, a mandatory Medicaid ser- 
vice),- April 1991: Non-SED children,- October 
1991: individuals age 18-20 (SMI and non-SMl),- 
October 1995: Non-SMI adults age 21 and older 
enrolled in acute care program,- October 1997: 
Received a 1-year extension to continue program. 
July 22, 1997. 

RBHAs (carve-out): Implemented October 
1990: SED children,- October 1991: Individuals age 
18-20 (SMI and non-SMI),- November 1992: SMI 
adults age 2 1 and older. Governor Symington issued 
an executive order that the State Department of 
Health Services either operate as Maricopa 
County's RBHA or award a contract. March 1998: 
Request for proposal (RFP) for Maricopa County 
Regional Service Area RBHA released. 

ALTCS (long-term care): Implemented 
December 19, 1988, for the developmentally dis- 
abled population,- implemented on January 1, 1989, 
for the elderly or physically disabled. 

ICMP: The IGA establishing the Maricopa 
ICMP was signed December 20, 1995. The project 
began taking its first cases in February 1996. The 
IGA establishing the Mohave ICMP was signed on 
April 25, 1996. The project began taking its first 
cases in June 1996. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 



The Arizona Medicaid program no longer has a fee- 
for-service component. 

Medicaid Mental Health Services 
Remaining Fee-For^Service 



The Arizona Medicaid program no longer has a fee- 

for-service component. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section ms - AHCCCS: 

Acute care health plans (for non-SMI, non-SED 
individuals age 18-20): Inpatient detoxification 



(e.g., up to 4 days or more based on medical need),- 
opiate treatment; outpatient,- inpatient (e.g., coun- 
seling, case management). 

RBHAs (carve-out): For adults: Unknown. For 
children: Unknown. 

ALTCS (long-term care): ALTCS provides insti- 
tutional care in either a Medicare/Medicaid- 
approved nursing facility or hospice or in an inter- 
mediate care facility for the mentally retarded 
(ICF/MR), if the member requires the level of care 
in these facilities. 

Medicaid Mental Health Services in 
Managed Care Plan 

Section ms - AHCCCS: 

Acute care health plans (for non-SMI, non-SED 
individuals, age 18-20): Inpatient (Institution for 
Mental Diseases (IMD) for individuals under age 21 
and over age 65; general acute care hospital, psy- 
chiatric facilities/hospitals); outpatient (e.g., clinic 
services, laboratory and radiology services for med- 
ication regulation and diagnosis, screening, evalua- 
tion and diagnosis, nonphysician providers, psy- 
chotropic medication adjustment and monitoring),- 
support (e.g., children's intensive case management, 
SMI clinical case management, case management, 
behavior management, individual therapy and 
counseling, group and/or family therapy and coun- 
seling,- partial care, basic and intensive in-home ser- 
vices),- crisis (e.g., 24-hour, emergency),- rehabilita- 
tion (e.g., psychosocial); pharmacy (psychotropic 
medications). 

RBHAs (carve-out): For adults: Unknown. For 
children: Unknown. Differential coverage is provid- 
ed for children with SED. Based on the Arizona 
Level of Functional Assessment Guide, intensive 
case management is assigned to children with high 
needs, thereby linked to SED. Children with lower 
needs are case coordinated. Comprehensive mental 
health services are available to either population. 

ALTCS (long-term care): Support (e.g., partial 
care, individual therapy and counseling, group 
and/or family therapy and counseling); inpatient 
(hospital services, psychiatric facility for individuals 
under age 2 1 ; IMD for individuals over age 65); res- 
idential; pharmacy (e.g., psychotropic medica- 
tions); crisis (e.g., emergency services); outpatient 
(e.g., evaluation and diagnosis, screening). 



52 



{SAMHSA} Managed Care Tracking System 



Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Section ni5 - AHCCCS: 

RBHAs (carve-out): Maximum 72-hour emer- 
gency care. 

ICMP: ICMP children who are assessed to have 
a need for substance abuse treatment may be 
enrolled with the RBHA (if not already enrolled) 
and will receive medically necessary services, tar- 
geted to address the substance abuse problem. 
These services are funded through the RBHA and 
provided according to the same criteria followed by 
the RBHA for non-lCMP Medicaid and non- 
Medicaid children. Depending on their involve- 
ment with other child-serving systems, ICMP chil- 
dren may also receive substance abuse services 
through other child-serving systems (e.g., the juve- 
nile court system). 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Section ms - AHCCCS-. 

RBHAs (carve-out): Maximum 72-hour emer- 
gency care. 

ICMP: ICMP children who are assessed to have 
a need for mental health treatment may be enrolled 
with the RBHA (if not already enrolled) and will 
receive all covered and medically necessary services, 
targeted to address the mental health problem. 
These services are funded through the RBHA and 
provided according to the same criteria followed by 
the RBHA for non-ICMP Medicaid and non- 
Medicaid children. Depending on their involve- 
ment with other child-serving systems, ICMP chil- 
dren may also receive mental health services 
through other child-serving systems (e.g., the 
Department of Economic Security/Administration 
for Children, Youth, and Families (DES/ACYF)). 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Section ms - AHCCCS: 

Acute health plans (for non-SMI, non-SED 
individuals age 1 8-20): Managed care organizations 
(MCOs) are expected to provide the following pre- 
vention services: Life skills, community develop- 
ment, environmental strategies, public awareness, 
parent education, mentoring, and peer leadership. 



Community development and community organiz- 
ing around prevention issues are currently being 
promoted as a State mandate to be supported by 
MCOs. 

RBHAs (carve-out): MCOs are expected to 
provide the following prevention services: Life 
skills, community development, environmental 
strategies, public awareness, parent education, men- 
toring, and peer leadership. Community develop- 
ment and community organizing around prevention 
issues are currently being promoted as a State man- 
date to be supported by MCOs. 

ALTCS (long-term care): Unknown. 

ICMP: Life skills, community development, 
environmental strategies, public awareness, parent 
education, mentoring, and peer leadership. 

Populations Covered Under Managed 
Behavioral Health 



Section ins - AHCCCS: 

Acute care health plans (for non-SMI, non-SED 
individuals, age 1 8-20): Adults and children manda- 
tory: Aid to Families with Dependent Children/ 
Temporary Assistance for Needy Families (AFDC/ 
TANF,) Seventh Omnibus Budget Reconciliation 
Act (SOBRA), Supplemental Security Income (SSI), 
SOBRA pregnant women and infants up to age 1 
(up to 140 percent Federal poverty level (FPL)). 

RBHAs (carve-out): Adults and children 
mandatory: AFDCAFANF, SOBRA, SSI, SOBRA 
pregnant women and infants up to age 1 (up to 140 
percent FPL),- the "State Only" groups, that is. 
Eligible Assistance Children, Medically Needy/ 
Medically Indigent, Eligible Low Income Children, 
are eligible only for emergency inpatient behavioral 
health admission for up to 72 hours per episode, 12 
days per contract year. 

ALTCS (long-term care): AFDC/TANF,- SSI. 
Individuals must be financially eligible to qualify for 
ALTCS. Nearly all ALTCS members meet financial 
eligibility requirements based on the established SSI 
criteria,- a small number are determined eligible 
based on TANF criteria. Once financial eligibility 
has been established for ALTCS, a preadmission 
screen (PAS) is conducted by a registered nurse or 
social worker to determine if the individual is at risk 
of institutionalization in either a nursing facility or 
ICF/MR. The registered nurse or social worker can 
refer the case to a physician for a final determina- 



July3l, 1998 



S3 



tion. AHCCCS has developed two standardized 
PAS instruments, one to screen elderly and physi- 
cally disabled persons and the other to screen 
developmentally disabled persons. The PAS instru- 
ments use weighted scores to provide information 
on the functional, medical, nursing, and social needs 
of an individual that are the basis for determining 
medical eligibility for ALTCS services. 

ICMP: Children served by multiple agencies. In 
the Maricopa County project, about 89 percent of 
the children served are in foster care through 
DES/ACYF; about 64 percent are enrolled with the 
RBHA for behavioral health services,- about 24 per- 
cent are on juvenile probation,- about 1 3 percent are 
receiving services through Department of 
Economic Security/Division of Developmental 
Disabilities (DES/DDD) for a developmental dis- 
ability,- and about 1 1 percent are on juvenile parole. 

In the Mohave County project, about 33 per- 
cent of the children served are in foster care through 
DES/ACYF; about 80 percent are enrolled with the 
RBHA for behavioral health services, about 50 per- 
cent are on juvenile probation,- about 7 percent are 
receiving services through DES/DDD for a devel- 
opmental disability,- and about 18 percent are on 
juvenile parole. 

Children are referred to the ICMP by case- 
workers from the participating agencies: 
DES/ACYF, DES/DDD, RBHA, Juvenile Probation, 
or Juvenile Corrections. (The Mohave project also 
allows referrals from the school system.) Children 
referred to the project must be currently involved in 
at least two of the child-serving systems identified 
above. The Mohave project also accepts referrals of 
children who are not currently involved in multiple 
systems, but are at immediate risk of becoming 
involved with more than one agency. Children 
referred must also have multiple unmet needs (needs 
that have not been successfully met through the tra- 
ditional service delivery system). 



State Managed Care Program 
Administration 



Section ms - AHCCCS: 

Acute care health plans (for non-SMI, non-SED 
individuals, age 18-20): AHCCCS is Arizona's 
Medicaid agency. For non-SMI individuals age 
1 8-20, AHCCCS contracts with 1 2 acute care pre- 



paid health plans (1 1 nonprofit, 1 for-profit). These 
contracts are awarded by the Geographic Service 
Areas, of which there are nine. 

RBHAs (carve-out): Arizona Department of 
Health Services (ADHS) is the State agency man- 
dated by the legislature to provide behavioral health 
services. AHCCCS contracts with ADHS, Division 
of Behavioral Health Seivices (ADHS/DBHS) for 
the provision of Medicaid-covered behavioral 
health services. Specifically, for all individuals 
except 18-20-year-olds who do not have an SMI, 
ADHS/DBHS contracts with five RBHAs. 
Contracts are established with the RBHAs to pro- 
vide the SMI services. RBHAs conduct planning, 
monitoring, and prior authorization for Arizona's 
behavioral health population. RBHAs are private, 
nonprofit corporations, established to administer 
public sector behavioral health services. Generally, 
RBHAs receive non-Medicaid funding according to 
established subvention formulae based on a number 
of indicators, including utilization information. 

Some RBHAs manage other services, but most 
concentrate on behavioral health services only. 
Other than case management, most RBHAs do not 
deliver direct services, but instead contract with the 
actual providers of behavioral health services. 
Participating plans include physician-owned plans, 
hospital-owned plans, local county plans, and sub- 
sidiary plans of several MCOs. Each RBHA subcon- 
tracts with regional and out-of-region providers to 
ensure that a continuum of services is available with- 
in each geographic area served. Providers in urban 
counties may represent physician-owned organiza- 
tions, hospital-owned organizations, local providers 
offering both inpatient and outpatient services, net- 
works of outpatient providers, individual practition- 
ers, laboratories, and case management agencies. 

For children and adolescents, a network of 
behavioral health providers are contracted with 
joindy by four State agencies. This process, termed 
SPOC, or single purchase of care, allows the child 
welfare agency, juvenile justice courts, juvenile cor- 
rections system, and the behavioral health system's 
RBHAs to plan jointly and procure behavioral 
health services for individually and jointly adminis- 
tered populations. 

ALTCS (long-term care): ALTCS services for 
the elderly or physically disabled population are 
delivered by a network of eight program contractors 



54 



{SAMHSA} Managed Care Tracking System 



located throughout the State. On October 1, 1996, 
AHCCCS awarded new contracts for up to a 5-year 
period, subject to annual renewal by AHCCCS. 
Program contractors provide services for ALTCS 
members in the same way that health plans provide 
acute care services to AHCCCS-enrolled members. 
Only one program contractor operates in each 
county, and members are enrolled with the program 
contractor in their county of residence. Once 
enrolled, the member has a choice of available pri- 
mary care providers who coordinate care and act as 
gatekeepers. 

By statute, ALTCS services for the developmen- 
tally disabled population are delivered by the 
DES/DDD under a capitation arrangement with 
AHCCCS. DES/DDD operates in the same manner 
as other program contractors and additionally 
administers a 100 percent State-funded program for 
developmentally disabled persons who are not eligi- 
ble for ALTCS. Once enrolled with DES/DDD, a 
developmentally disabled member chooses a prima- 
ry care provider, who coordinates the member's 
care. 

ICMP: The ADHS/DBHS is designated as the 
lead agency. DBHS is responsible for administering 
the interagency coordinated program involving 
case managers, caseworkers, probation officers, and 
parole officers. 

For both the Mohave and the Maricopa pro- 
jects, children receiving services through the ICMP 
are potentially eligible to receive services from 
providers who contract with any of the child-serv- 
ing agencies with which they are currently 
involved. For example, a child who was on proba- 
tion, dependent, and enrolled in an RBHA would be 
potentially eligible to receive any of the services 
contracted for through the county juvenile proba- 
tion department, the DES/ACYF district, and the 
responsible RBHA. The child would receive services 
provided through these systems based on each 
agency's criteria for provision of the service (e.g., for 
behavioral health the service needs to be medically 
necessary). 

If a needed service is provided by an agency in 
which the child is not currently involved, the ICMP 
project facilitates the child's enrollment or referral 
to the system so that the needed service can be 
requested. For example, an ICMP child who is 
assessed to have a need for a psychiatric evaluation 



is enrolled with the RBHA so that the service can be 
acquired. 

For the Maricopa ICMP, the primary agency 
players involved in the child and family's case are 
the members of the ICMP case management team. 
The team includes the family's ICMP case manager, 
an ICMP case manager aide, the ICMP supervisor, 
and the ICMP consulting/treating psychiatrist. The 
ICMP case manager is the primary link between the 
family, the child-serving agencies in which the fam- 
ily is involved, the health plan, the primary care 
provider, and the various providers from which the 
child or family members receive services. 

For the Mohave ICMP, responsibility for coor- 
dination in a child's case is more generalized, and 
resides primarily with MAT team members. TTie 
County-Wide Coordinator (CWC) is responsible 
for coordination of MAT meetings, which bring all 
agencies involved in the case and the child's family 
together to discuss the case and develop a MAT ser- 
vice plan. The agency who initially referred the 
child to the project is designated the Lead Agency, 
and the MAT team representative from this agency 
leads the development of the MAT service plan. At 
the MAT meeting, responsibility for follow-through 
activities identified in the MAT service plan is 
assigned to MAT team agency representatives, as 
appropriate. The CWC is responsible for monitor- 
ing follow-through on the activities identified in the 
MAT plan and for arranging future MAT team meet- 
ings on the case as needed. 

Financing of Plans 

Section ms - AHCCCS-. 

Acute care health plans (for non-SMI, non-SED 
individuals, age 18-20): Medicaid finances the 
AHCCCS program. Health plans are paid an up- 
front or prospective monthly capitation amount for 
each member enrolled with the health plan. The 
capitation rate is based on a rate code (e.g., popula- 
tion category) and geographic area. TTie State hired 
an independent actuarial firm to develop rate ranges 
based on fee-for-service (FFS) experience provided 
by counties and an actuarial database. These rate 
ranges form the basis for capitation rates. 
Anticipated savings associated with managed care 
were built into the capitation rate. Savings and prof- 
its may be used to reinvest in administration of ser- 
vices and to build financial stability. 



July 31, 1998 



55 



For each Medicaid dollar available to the acute 
care plans under AHCCCS, the State match is paid 
through a combination of general fund monies and 
a fixed contribution from each county. 

RBHAs (carve-out): ADHS obtains block grants 
and legislative appropriations for behavioral health 
services, including non-Medicaid funds. These State 
funds are apportioned to the RBHAs under the 
terms of their contract with ADHS. Federal block 
grant funding is also available to RBHAs for treat- 
ment programs for pregnant women with substance 
abuse problems. Generally, RBHAs receive non- 
Medicaid funding according to established subven- 
tion formulae based on a number of indicators, 
including utilization information. 

AHCCCS gives ADHS a capitation rate per 
member per month for the entire number of Title 
XlX-eligible individuals on AHCCCS. ADHS then 
pays the RBHAs according to their contracts (the 
process is between ADHS and the RBHAs, and 
AHCCCS is not involved). The RBHAs are at risk 
and receive a capitation rate for Medicaid covered 
services, as well as a budget allocation for block 
grant and State-only funds each month. Depending 
on the subcontract agreement, RBHAs may pass on 
risk to their subcontracted providers. Provider con- 
tracts are either capitated or paid on an FFS basis. 

The capitation rate is based on a rate code (e.g., 
population category) and geographic area. The 
State hired an independent actuarial firm to develop 
rate ranges based on FFS experience provided by 
counties and an actuarial database. These rate 
ranges form the basis for capitation rates. 
Anticipated savings associated with managed care 
were built into the capitation rate. Savings and prof- 
its may be used to reinvest in administration of ser- 
vices and to build financial stability. 

ALTCS (long-term care): ALTCS is funded by 
Federal, State, and county monies. Historically, the 
county contribution was established by the legisla- 
ture, and the counties paid most of the State share 
for the ALTCS program. In November 1997 the 
State legislature froze the counties' contributions at 
State fiscal year 1997/1998 levels and required the 
State and counties to each pay 50 percent of any 
increase. State funding for the developmentally 
disabled population is included in the DES/DDD 
budget, and AHCCCS passes through the Federal 
funding to DES/DDD. 



Parallel to the acute care program, AHCCCS 
pays program contractors prospectively on a capi- 
tated basis. ALTCS capitation rates are blended 
rates that include nursing facility costs, home- and 
community-based services, acute medical care ser- 
vices, behavioral health services, and case manage- 
ment services. Beginning October 1, 1997, the 
weighted average statewide capitation rate paid to 
program contractors for covered services provided 
to the elderly or physically disabled population is 
$2,192 per member per month. The weighted aver- 
age for the developmentally disabled population is 
$2,082. The rates are based on AHCCCS FFS rates, 
program contractor financial statements, service uti- 
lization data, and historical trends, in a contract 
year, this information is used to determine the capi- 
tation rate ranges,- in renewal years, this information 
is used to adjust rates. All ALTCS-eligible individu- 
als are required to contribute a share of the cost for 
institutional care. TTiis share is generally calculated 
by subtracting certain allowable deductions from 
the individual's income. 

/CMP. The Mohave and Maricopa ICMP pro- 
jects are 5-year pilot projects funded by the ADES,- 
the Administrative Office of the Arizona Supreme 
Court (AOC), ADHS/DBHS, and the Arizona 
Department of Juvenile Corrections (ADJC). 
Agencies share annual operations, equipment, and 
program evaluation costs for the ICMP case man- 
agement site in Maricopa County and for the CWC 
and associated costs in Mohave County. Each fiscal 
year, DES, AOC, and ADJC transfer their annual 
share of funds for the project to ADHS/DBHS. 
DBHS transfers these funds to the RBHA responsi- 
ble for the financial management of each project. 
The RBHAs contribute the BHS share of funds for 
the projects. 

The ICMP project does not use blended fund- 
ing to purchase services for ICMP clients. Services 
provided to ICMP children are authorized and paid 
for by the traditional children's service delivery sys- 
tems, in the same way that services are authorized 
and paid for non-lCMP children. Because the ICMP 
projects currendy link clients with services using the 
traditional service delivery systems, the risk and 
method of provider payment remains the same for 
ICMP and non-lCMP clients. 



56 



{SAMHSA} Managed Care Tracking System 



Coordination Between Prinnary and 
Behavioral Health Care 

Section ms - AHCCCS: 

Acute care health plans (for non-SMI, non-SED 
individuals, age 18-20): A contract between ADHS 
and AHCCCS provides the important first step in 
the partnering process. It ensures collaboration and 
coordination of the administration and manage- 
ment of both agencies to effectively administer the 
managed behavioral health care program for 
Medicaid recipients. The medical directors of both 
agencies routinely collaborate on the development 
of policy directives for health plans and RBHAs. 
Meetings are held at least quarterly and primarily 
focus on member-level coordination of care issues. 
In addition to developing and reviewing medical 
criteria such as treatment guidelines and placement 
criteria, attendees exchange information about 
health plans and RBHA systems. 

RBHAs (carve-out): RBHAs are required to link 
with members' health plans to obtain needed med- 
ical information and to advise the primary care 
physicians regarding the member's mental health 
treatment. Regular, ongoing meetings occur 
between health plan representatives and RBHA 
directors to ensure that the coordination is occur- 
ring. The health plan is the medical care home base. 
The health plan may refer members to RBHAs, but 
the member may also self-refer. All individuals who 
qualify for Title XIX Medicaid in Arizona are eligi- 
ble for the behavioral health carve-out (with the 
exception of non-SMI individuals age 18-20, who 
are enrolled in health plans) because the behavioral 
health services are part of the AHCCCS service 
package. 

ALTCS (long-term care): Acute medical care 
services provided to ALTCS members are the same 
as those provided in the acute care program. Each 
ALTCS member is assigned a case manager by the 
program contractor. The case manager coordinates 
care with the primary care provider and is responsi- 
ble for identifying, planning, obtaining, and moni- 
toring appropriate services that meet the member's 
needs. 

ICMP: Coordination of care between the RBHA 
and the health plan/primary care provider for 
RBHA-enrolled, ICMP children is carried out in the 
same manner as it is for RBHA-enrolled non-ICMP 
children. The ICMP case manager is required to 



perform the same coordination functions with 
health plans and primary care providers, using the 
same procedures that RBHA case managers follow. 

Consumei^Family Involvement 



Sectioft iH5 - AHCCCS: 

Acute care health plans (for non-SMI, non-SED 
individuals, age 18-20): Unknown. 

RBHAs (carve-out): Advocates Coming 
Together (ACT), a group of consumers, family 
members, advocates, and other stakeholders in 
the behavioral health system, developed recom- 
mendations concerning system redesign in 
Maricopa County. ACT produced "Managed Care 
Vision, Values, and Principles" and RFP recom- 
mendations from the consumer perspective. 
Recommendations were presented to the RFP 
development committee and considered m the 
final design. Queries and responses regarding this 
process were also addressed in the bidder's confer- 
ence, follow-up technical response bulletins, and 
RFP amendment. 

ALTCS (long-term care): Unknown. 

/CA4P. Families were involved in the develop- 
ment of the ICMP projects through representation 
on the Children's IGA Executive Committee, the 
ICMP Case Management Work Group, and the 
Mohave Planning and Oversight Committee when 
these committees were engaged in the planning 
phase for the projects. 

Future Plans 



Section Hi 5: AHCCCS: 

Acute care health plans (for non-SMI, non-SED 
individuals, age 18-20): Currently, AHCCCS is 
working to have its State plan amendment approved 
by the Health Care Financing Administration for 
the Title XXI, State Children's Health Insurance 
Plan for medical and mental health services to 
Arizona's uninsured under- 19 population meeting 
150 percent FPL. 

RBHAs (carve-out): Governor Hull recently 
proposed a plan to include $7 million in supple- 
mental funding for the SMI population in Maricopa 
County. Additionally, the new contractor chosen to 
become the RBHA for Maricopa County (Phoenix) 
will begin its 3-year contract August 1, 1998. The 
State released its RFP March 31, 1998. 



July 31, 1998 



57 



ALTCS (long-term care): Effective October 1, 

2000, the statutory requirement was deleted 
which mandated that the two largest Arizona 
counties must be program contractors and that 
three other counties be given the right of first 
refusal to be a program contractor. As the law is 
now written, all of Arizona's 15 counties will be 
required to competitively bid if they want to par- 
ticipate as program contractors for their respec- 
tive counties. The ALTCS RFP that goes out to 
bid in 2000 will represent the first time that com- 
petitive bids will be accepted for all counties and 
the first time that the previously mandated coun- 
ties will be required to compete with other pro- 
gram contractors to provide ALTCS services in 
their respective counties. 

ICMP: A comprehensive evaluation is current- 
ly being conducted on the Maricopa ICMP pro- 
ject, with final evaluation results due in the year 

2001. Interim and final evaluation results are likely 
to be significant factors in determining whether 
the project will be continued past its 5-year pilot 
period. There continues to be substantial interest 
in expanding the ICMP so that more multiagency 
children and their families can be served through 
the project. The possibility of expansion continues 
to be explored. 



State Agency Administration 



ADHS houses DBMS (Mental Health) and Office 
of Substance Abuse and General Mental Health 
Services (Substance Abuse). The Medicaid agency, 
AHCCCS, is a separate State agency. 

Welfare Reform 

Under Arizona's welfare reform plan, drug testing is 
not mandatory for TANF eligibles,- however, a 
TANF-eligible individual who is convicted of a drug 
felony will be denied benefits. 

County 

ADHS/DBHS released an RFP seeking a contractor 
for the development, management, and delivery of 
covered services in Maricopa County. 

Evaluation Findings 

Section ms - AHCCCS: Independent quality audits 
have been performed periodically. 



Other Quantitative Data 



As of July 1998, AHCCCS provided acute care, 
behavioral health, and long-term care services to 
431,047 eligible members (approximately 10 per- 
cent of Arizona's population). 



58 



{SAMHSA} Managed Care Tracking System 



ARKANSAS 



OVERVIEW 




The Department of Human Services (DHS) recently released a request for proposals (RFP) for a 
behavioral health managed care program for individuals under age 21. Other than this program, 
behavioral health services are not included under the rubric of managed care. 

The program, known as Benefit Arkansas, is funded through a combination of Medicaid, Title IV- 
E, and State general revenue (SGR) dollars. Mental health services are included, but substance abuse 
services are included only for the dually diagnosed. 



Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 

Section 1915(b) - Benefit Arkansas - mental health stand-alone: Mental health services for children and 

adolescents under age 21; substance abuse services provided only to dually diagnosed. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 
Not applicable. 




Geographic Location 



Section i9i5[b') - Benefit Arkansas: Statewide,- divided 
into five regions. 



Status of Programs 



Section i9i5(h) - Benefit Arkansas: Submitted May 1, 
1998; currently under Health Care Financing 
Administration review,- implementation expected 
October 1, 1998. Effective until June 30, 1999. 

Medicaid Substance Abuse Services 
Remaining Fee-For^Service 

Arkansas does not recognize "substance abuse" as a 
Medicaid-covered service. Arkansas does treat the 
effects of substance abuse, but not as a rehabilitative 
service. 

Medicaid Mental Health Services 
Remaining Fee-For^Service 

The following mental health services are covered 
under the Arkansas Medicaid program: inpatient, 



outpatient, rehabilitation. Institution for Mental 
Diseases services for individuals under age 21. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section i9i5[b] - Benefit Arkansas: Substance abuse ser- 
vices for dually diagnosed individuals only include 
acute and subacute detoxification (e.g., medical, 
observation); residential; outpatient (e.g., structured 
addiction programs, diagnostic evaluation, medica- 
tion visits, counseling); inpatient services. 

Medicaid Mental Health Services in 
Managed Care Plan 

Section i9i sib] - Benefit Arkansas: Inpatient, outpatient 
(e.g., observation/holding beds, partial hospitaliza- 
tion); crisis (e.g., stabilization, emergency shelters, 
community-based crisis intervention); residential 
(e.g., 24-hour treatment, stabilization); mental 
health support (e.g., case management, mental 
health rehabilitation). 



July 31, 1998 



59 



Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section i9i5(b] - Benefit Arkansas: Early and periodic 
screening, diagnosis, and treatment. The RFP states 
that the program must promote early identification 
of mental, emotional, or behavioral disorders,- pro- 
vide early intervention with appropriate mental 
health services and supports to children and fami- 
lies, and encourage activities that identify and ame- 
liorate environmental factors that put children at 
risk for developmental, emotional, or behavioral 
problems. 

Populations Covered Under Managed 
Behavioral Health 

Section i9i5[b) - Benefit Arkansas: Mandatory children 
and adolescents: Aid to Families with Dependent 
ChildrenATemporary Assistance for Needy Families 
individuals under age 21 and children in custody of 
the Division of Child and Family Services. 

State Managed Care Program 
Administration 



Section I9i5[b] - Benefit Arkansas: DFHS plans to con- 
tract with Arkansas Behavioral Care, LLC (ABC). 
ABC comprises a private, for-profit behavioral 
health managed care organization (BF^MCO) and 
Summit, LLC, a limited liability corporation formed 
by the Mental FHealth Centers of Arkansas (State 
community mental health centers (CMF-lCs)). The 
BF4MCO is the majority stakeholder, although the 
Board of ABC has representation from Summit. 
ABC will contract with individual mental health 
centers separately for services as well as non- 
CMHC providers under the State's any-willing- 
provider rules. 

For those dually diagnosed, the primary diag- 
nosis will determine the lead agency responsible for 
the child. 



Financing of Plans 

Section i9i5[h] - Benefit Arkansas: This program will be 
financed primarily through Medicaid and Title IV-E 
and some SGR funds. ABC is capitated and at full 
risk. Nine capitation rates have been established: 
three different age ranges for children on Medicaid 
not in custody, three rates for children in custody of 
the State, utilizing Medicaid, Title IV-E, and SGR; 
and three rates for children currently in a 1115 
waiver, under the age of 19, who will be included as 
a covered target population on January 1, 1999. 
This last group (ARKids First) represents a popula- 
tion between 100 percent and 200 percent of 
Federal poverty level (FPL). 

Medicaid capitation can pay for services for 
non-custody DF^S children if funds for them have 
been exhausted. The capitation rates are fixed by 
the Division. ABC can pass down or share risk 
through subcapitation or case rates with its subcon- 
tractors. Alternatively, ABC can reimburse its sub- 
contractors on a fee-for-service basis. 

An actuarial firm was hired by DF-IS to calculate 
mental health capitation rates for the program, and 
the current Medicaid funding stream was used to 
construct the capitation rates. They are calculated at 
93.8 percent upper payment limit,- the 6.2 percent 
reduction covers the costs to the State for program 
administration and monitoring. Included within the 
actuarial computations were the monies used to pay 
for services where there was dual diagnosis,- there- 
fore, no new funding stream was included for dual- 
ly diagnosed individuals. There is no incentive to 
generate savings,- the administrative rate has been 
set with a withhold that can be earned back through 
acceptable performance. All funds not spent on 
consumer services as allocated will be spent on sys- 
tem improvements benefiting consumers in the fol- 
lowing year. 

Coordination Betv^een Primary and 
Behavioral Health Care 



Section i9i5[h] - Benefit Arkansas: The program inte- 
grates services and supports for children and youth 
with mental, emotional, or behavioral disorders by 
using, promoting, or creating coherent policy 
around planning, evaluation, programmatic, and 
financial linkages among agencies with responsibil- 
ity for children and youth. 



60 



{SAMHSA} Managed Care Tracking System 



Consumer-Family Involvement 



Section i9i5(b] - Benefit Arkansas: Families and con- 
sumers are involved as full participants in all aspects 
of the planning, delivery, and evaluation of man- 
aged behavioral health care services. 

Future Plans 

Section 49 i 5(h) - Benefit Arkansas: Under the new 
Children's Health insurance Program (CHIP), 
ARKids First (200 percent FPL) up to age 1 8 will be 
included by January 1, 1999. Substance abuse treat- 
ment may be added at a later date to this waiver,- if 
this occurs, capitation rates will be adjusted accord- 
ingly. 

* New Program Under Development: The University 
of Arkansas for Medical Science has developed the 
prototype model for the treatment of addicted 
women with families. The Bureau of Alcohol and 
Drug Abuse Prevention will be responsible for the 
development of the 1915(b) Medicaid waiver. This 
waiver is incomplete at this time. 

State Agency Administration 

The Division of Mental Health Services and the 
Division of Medical Services (Medicaid) are under 
the DHS. The Bureau of Alcohol and Drug Abuse 
Prevention is under the Department of Health. 

Welfare Reform 

Currently, under the Arkansas welfare reform plan, 
Temporary Assistance for Needy Families (TANF) 



will be denied to those convicted of felonies involv- 
ing the manufacture or distribution of drugs. 
However, the State plan names substance abuse 
treatment as a supportive service. Clients who have 
felony convictions and are not eligible to receive 
substance abuse services under TANF will be pro- 
vided services through the Substance Abuse 
Prevention and Treatment (SAPT) block grant. 

At this time, the Arkansas Department of 
Health, Bureau of Alcohol and Drug Abuse 
Prevention, is working with other agencies to devel- 
op a curriculum to train caseworkers to screen, iden- 
tify, and refer individuals who need substance abuse 
services. Because of a waiting list of approximately 
400 clients per day seeking substance abuse ser- 
vices, the Bureau is currendy negotiating with DHS, 
Division of County Operations, to secure addition- 
al funding from TANF savings. Substance abuse ser- 
vices will be expanded to provide timely treatment 
to TANF recipients. 

County 

Not applicable. 

Evaluation Findings 



Section i9i5(b') - Benefit Arkansas: The RFP indicated a 
number of performance indicators with which the 
managed care organization will comply. 

Other Quantitative Data 

Not applicable. 



July 31, 1998 



6i 



C ALI FORM I A 



OVERVIEW 



As managed behavioral health care evolves in California, two separate managed care systems — one 
for mental health and one for substance abuse — are being developed and implemented. 

California has implemented its Medi-Cal managed care initiatives primarily on the county level. 
Counties serve as the local mental health plan manager (MHP). As the plan managers, counties are 
responsible for authorizing and paying for all publicly funded mental health services. The Depart- 
ment of Mental Health (DMH) has played a key role in assigning counties such responsibility. 

Most recently, DMH began implementing a 1915(b) waiver for Medi-Cal Specialty Mental 
Health Services (inpatient and outpatient) Consolidation. This is the second phase of mental health 
services consolidation at the county level. In 1995, inpatient hospital services and State-funded men- 
tal health services were realigned at the county level. The newest waiver completes the consolidation 
of Medi-Cal mental health funding at the county level. It subsumes the previous waiver for inpatient 
psychiatric hospital services and incorporates mental health services that previously were included in 
the Department of Health Services' managed care programs for physical health. After successful 
implementation of the Medi-Cal Specialty Mental Health Services Consolidation program, 
California's next step will be to establish the program under a capitated or other full-risk model. 

In addition, two separate managed mental health field tests are currently operating in California 
counties to test various concepts as the State moves toward capitation (see County Section for a full 
description). 

Substance abuse is excluded from all California waivers and is reimbursed on a fee-for-service 
(FFS) basis. There is currently a major statewide planning effort, however, to create an outcome- 
based managed system of care in the substance abuse field that is unique to California's needs. 




Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 

Section 1915(b) - Medi-Cal Specialty Mental Health Services Consolidation - mental health stand-alone: 

Inpatient and outpatient mental health services are consolidated at the county level. 

Section 1915(b) -Two-Plan Model - integrated: Physical health waiver includes substance abuse services 

in 1 2 counties. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

Short-Doyle Progrann - mental health stand-alone: State-funded program that provides reimbursement 

for county mental health services to Medi-Cal-eligible and indigent individuals. 



Geographic Location 



Section i 9 i 5[b) - Medi-Cal Specialty Mental Health Services 
Consolidation: Statewide (except Solano and San 
Mateo County Field Tests — see County Section). 

Section i9i5(b) - Two-Plan Model 12 counties 
(Alameda, Contra Costa, Fresno, Kern, Los Angeles, 



Riverside, San Bernardino, San Francisco, San 
Joaquin, Santa Clara, Stanislaus, Tulare). 

Short-Doyle Procjram: Same as Medi-Cal Specialty 
Mental Health Services Consolidation program. 



July 31, 1998 



63 



Status of Programs 



Section i9i5[b] - Medi-Cal Specialty Mental Health 
Services Consolidation: Submitted to the Health Care 
Financing Administration August 7, 1997. 
Approved as renewal of original Medicaid psychi- 
atric inpatient hospital services consolidation 
waiver September 5, 1997 (this waiver was first 
implemented in March 1995). Fully implemented 
in 56 counties by July 1, 1998. Implementation 
schedule: 

• November 1, 1997 - 5 counties 

• January 1, 1998 - 10 counties 

• April 1, 1998 - 32 counties 

• June 1, 1998 - 8 counties 

• July 1, 1998 - 1 county 

Section {91 5(h) - Two-Plan Model Implemented 
January 22, 1996. 

Short-Doyle Program: Same as Medi-Cal Specialty 
Mental Health Services Consolidation program. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 



Medicaid Mental Health Services in 
Managed Care Plan 



Opiate treatment program (e.g., narcotic), outpa- 
tient drug-free services (e.g., naltrexone treatment 
services); rehabilitative (e.g., day care rehabilitative 
treatment services),- residential (e.g., perinatal sub- 
stance abuse services). 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Inpatient,- outpatient (e.g., direct services by 
licensed clinical social workers and marriage, fami- 
ly, and child counselors for children only, physician 
services, psychologist sen/ices limited to two per 
month for adults, clinic services), pharmacy,- reha- 
bilitation (Rehab Option, offered only through the 
Short-Doyle/Medi-Cal program),- support (e.g., tar- 
geted case management). 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section i 9 i 5{h) - Medi-Cal Specialty Mental Health Services 
Consolidation: Not applicable. 

Section i9i5(h) - Two-Plan Model Unknown. 



Section i9i5[h] - Medi-Cal Specialty Mental Health 
Services Consolidation: Inpatient,- outpatient, crisis 
(e.g., emergency services),- mental health support 
(e.g., case management, medication support),- resi- 
dential,- rehabilitation (e.g., day treatment). 

Section I9i5[h] - Two-Plan Model. Not applicable. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Short-Doyle Program: Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Short-Doyle Program: Rehabilitation (e.g., day treat- 
ment),- inpatient (e.g., psychiatric hospital),- sup- 
port (e.g., targeted case management),- residential 
(e.g., adult, crisis). 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section i9i5[h')- Medi-Cal Specialty Mental Health Services 
Consolidation: None. 

Section i9i5[b) - Two-Plan Model Unknown. 

Short-Doyle Program: Same as Medi-Cal Specialty 
Mental Health Services Consolidation program. 

Populations Covered Under Managed 
Behavioral Health 

Section i 9 i 5[b] - Medi-Cal Specialty Mental Health Services 
Consolidation: Mandatory adults and children: Aid to 
Families with Dependent Children/Temporary 
Assistance for Needy Families (AFDC/TANF),- 
Supplemental Security Income (SSI),- dually diag- 
nosed. 

Section i9i5(h] - Two-Plan Model Unknown. 

Short-Doyle Program - Mandatory adults and 
children: AFDC/TANF,- SSI,- uninsured, under- 
insured. 

State Managed Care Program 
Administration 

Section i9i5(h) - Medi-Cal Specialty Mental Health 
Services Consolidation: This program is administered 
by DMH through an interagency agreement with 
the Department of Health Services, the single State 



64 



{SAMHSA} Managed Care Tracking System 



Medicaid agency. DMH formally contracts with 
MHPs for service delivery. The county mental 
health department has the first right of refusal to 
serve as the MHP. Currently, all MHPs are county 
mental health departments. County MHPs are the 
designated point of responsibility for the delivery 
of specialty mental health services (psychiatric 
inpatient hospital services, licensed clinical social 
worker and marriage, family, and child counselor 
services,- and targeted case management) to treat 
most mental health diagnoses. The program does 
not cover treatment of diagnoses such as substance 
abuse disorders, cognitive disorders, mental retar- 
dation, and antipersonality disorder, although the 
mental health treatment for individuals with dual 
diagnoses will be covered by the MHPs (see 
County Section for more detail). MHP provider 
networks include organizational providers previ- 
ously contracting with the MHP and individual and 
group practitioners (psychiatrists, psychologists, 
LCSWs, MFCCs, RNs with master's degrees). 

DMH is responsible for monitoring and over- 
sight to ensure that services comply with all Federal 
and State requirements. DMH requires local MHPs 
and providers to establish and use systems to review 
the quality and appropriateness of services funded 
by Medi-Cal and audits for compliance with Medi- 
Cal requirements. 

Section i9i5[b] - Two-Plan Model The State 
contracts with one private, for-profit managed 
care organization and one local initiative (U) 
plan — a quasi-public agency — in each of the 12 
counties except Fresno County, which has two com- 
mercial plans because the LI was unqualified. These 
two entities compete for the county's Medi-Cal 
recipients. 

Short-Doyle Program: Same as Medi-Cal Specialty 
Mental Health Services Consolidation program. 

Financing of Plans 



Section i9i5(h] - Medi-Cal Specialty Mental Health 
Services Consolidation: This program operates as a 
managed FFS system. It is funded through 
Medicaid and State general funds. For State mental 
health dollars, one-half of 1 percent of State sales 
tax is directly allocated to the counties for exclusive 
use. State sales tax goes directly to counties. There 
is also an allocation for Medi-Cal specialty mental 
health services. 



MHPs also claim Federal financial participation 
(FFP) on an FFS basis for Medi-Cal services. 
Provider contracts with MHPs are primarily on a 
per diem basis. MHPs claim FFP on an FFS basis. 
Payment to provider is made with a variety of fund- 
ing sources, including sales tax revenues. State 
General Fund allocation, FFP, and other sources. 
Funding is blended but also tracked separately for 
cost reporting purposes. 

Section i9i5[b) - Two-Plan Model TTiis program is 
funded by Medicaid dollars. The two plans are fully 
capitated and at risk. Capitation rates are set using a 
two-step process. First, an overall limit on program 
expenditures is calculated in order to comply with 
the requirement of the 1915(b) waiver that expen- 
ditures not exceed expected FFS expenditures for 
the enrolled population. For each county included 
in the pilot, capitation rates are developed. These 
rates are based on Medi-Cal managed care experi- 
ence in one county, Santa Barbara, which has a par- 
ticularly well-established, well-managed, and well- 
documented county-operated system. 

Short-Doyle Program: Same as Medi-Cal Specialty 
Mental Health Services Consolidation program. 

Coordination Between Primary and 
Behavioral Health Care 



Section i9i5(b)- Medi-Cal Specialty Mental Health Services 
Consolidation: Primary care providers are expected to 
continue to provide primary mental health services 
and receive support from county MHPs in the form 
of clinical consultation on issues such as appropriate 
medications and medication monitoring. County 
MHPs and Medi-Cal managed care plans are 
required to have formal memoranda of understand- 
ing covering referrals, clinical consultation, appro- 
priate exchange of medical information, and dispute 
resolution. The county MHPs are required to estab- 
lish protocols for coordination of care with FFS 
providers. 

Section i9i5(b] -Two-Plan Model Unknown. 

Short-Doyle Program: Same as Medi-Cal Specialty 
Mental Health Services Consolidation program. 

Consumer^Family Involvement 



Section i 9 i 5(b] - Medi-Cal Specialty MaHal Health Services 
Consolidation: Consumers and families had extensive 
involvement in the planning process on various 
State and local committees. Also, they were 



July 31, 1998 



65 



involved in State oversight monitoring of county 
plans. 

Section i9i5[b] - Two-Plan Model Unknown. 

Short-Doyle Program: Same as Medi-Cal 
Specialty Mental Health Services Consolidation 
program. 

A Managed Mental Healthcare Steering 
Committee, with broad representation from the 
State mental health and Medicaid agencies, the 
California Mental Health Directors Association, 
consumers, the California Mental Health 
Planning Council, and other stakeholders, was 
established when the State first began planning 
managed mental health care in 1991. Authority 
for consumer/family membership on the Steering 
Committee is in State legislation (Welfare 
Institutions Code Section 14683). Members 
advised the DMH regarding the development and 
implementation of managed care for mental 
health and assisted in the resolution of the follow- 
ing issues: coordination of physical health and 
mental health care, access criteria for mental 
health services, minimum service array, quality 
improvement and performance outcome mea- 
sures, client satisfaction, client and provider griev- 
ance procedures, children's issues, older adult 
issues, cultural competency and linguistic accessi- 
bility, management information systems, and 
financial terms of participation. 

Future Plans 



Section i9i5[b)- Medi-Cal Specialty Mental Health Services 
Consolidation: In the future, the State expects to move 
to a fully capitated payment system for MHPs, 
which will constitute the final phase of mental 
health managed care implementation. There is cur- 
rently no target date for implementation of a fully 
capitated payment system. 

Section i9i5(b] - Two-Plan Model Unknown. 

Short-Doyle Program: Same as Medi-Cal Specialty 
Mental Health Services Consolidation program. 

* New Program Under Development: Alcohol and 
Other Drugs (AOD) System of Care; The 
Department of Alcohol and Drug Programs (ADP) 
has proposed a framework for the redesign of the 
substance abuse services delivery system to create 
an outcome-based system of care that focuses on 
each client's individual needs and provides im- 
proved data and accountability. The design came 



from several years of study by the Department's 
Managed Care Policy Advisory Committee 
(MCPAC), which made several recommendations 
to improve the effectiveness and efficiency of sub- 
stance abuse prevention and treatment systems. In 
particular, the committee's recommendations were 
to "unbundle" the rate structure, implement a data 
collection phase (based on a single client-based 
billing system), and then consider financing 
options. Other recommendations included adopt- 
ing a standardized assessment tool to determine 
client level of functioning, using American Society 
of Addiction Medicine levels of care, and collecting 
outcome data for clients. 

The fundamental principles of the MCPAC 
include the acknowledgment and maintenance of 
the distinct, diverse, and specialized substance 
abuse treatment and recovery services network. 

This proposed redesign continues the existing 
concept of local control of substance abuse pro- 
gram services. Counties, as brokers of services, will 
develop and provide a continuum of services based 
on the assessed needs of the county population and 
available resources. The redesign and automation 
of the statewide substance abuse prevention, treat- 
ment, and recovery system will improve the State's 
ability to describe substance abuse services, costs, 
and client outcomes. The proposed system will 
provide better data at all levels. Information gaps in 
the current system will be closed by linking the fis- 
cal and program data together in client records, 
including demographic data, services, and expendi- 
tures at the State, county, and provider levels. 
Proposed assessment and placement/discharge 
processes will allow evaluation of a client's progress 
with measurable levels of functioning at entry, dur- 
ing treatment, at exit, and following exit from ser- 
vices. Uniform services definitions and standards of 
care will align services provided with different 
funding sources. 

The Department of ADP is identifying 
changes and developing new systems with input 
from an advisory group of field representatives and 
stakeholders. The system of care continues the 
existing concept of local control of the substance 
abuse prevention, treatment, and recovery net- 
work. Counties, as brokers, will develop and 
administer the provision of services based on the 
assessed needs of the population and available 
resources. 



66 



{SAMHSA} Managed Care Tracking System 



State Agency Administration 

Medicaid (called Medi-Cal in California), mental 
health, and substance abuse are administered by 
separate departments within the Health and 
Welfare Agency. The Medi-Cal program is adminis- 
tered by DHS, the mental health program is admin- 
istered by the DMH, and all substance abuse pro- 
grams, including the Drug Medi-Cal Program, are 
administered by the Department of ADP. 

Welfare Reform 

• California submitted its Welfare-to-Work 
(WtW) grant on March 4, 1998. The grant will 
be administered by the Employment 
Development Department. One hundred per- 
cent of state funds will serve as the matching 
funds. Fifteen percent of the State project funds 
will be used as grants to State and local, public 
and private entities that will assist long-term 
TANF recipients entering unsubsidized 
employment. Special consideration will be 
given to proposals from rural areas, proposals 
that demonstrate leveraging of other resources, 
and proposals that demonstrate a coordinated 
approach to services. The substate allocation 
formula for 85 percent of the funds is as follows: 
55 percent poor, 35 percent TANF, and 15 per- 
cent unemployed. Coordination mechanisms 
linking local WtW entities and local TANF 
agencies are required as part of local plans. 
Performance goals or outcome measures 
include a minimum of 45 percent of participants 
placed in unsubsidized jobs,- a minimum of 70 
percent of participants placed in unsubsidized 
employment after 6 months,- and an average 
wage increase of 10 percent over the average 
wage placement for participants who remain 
employed for 6 months. Local targeting strate- 
gies will be developed by private industry 
councils in coordination with county welfare 
departments and other local WtW preparation 
partners. State targeting strategies for the 
Governor's 15 percent fund may include those 
with special barriers (e.g., homeless, individuals 
with mental illness, substance abusers). 

• Welfare reform, like managed mental health 
care, is being implemented at the county level. 
Many counties in California are implementing 



welfare reform in different ways. On August 1 1, 
1997, California enacted AB 1542, the Welfare- 
to-Work Act of 1997. This act renames the 
Federal TANF program the "California Work 
Opportunity and Responsibility to Kids" 
(CalWORKs) program. CalWORKS requires 
each county to submit a county plan to the 
State Department of Social Services. The coun- 
ty plans must include the provision of alcohol 
and drug services to recipients whose substance 
abuse creates a barrier to employment. A par- 
ticipant who is in a job search component of 
the county's WtW program (formally called the 
Greater Avenues for Independence (GAIN) 
program) may be directed to an assessment by 
the job search manager if the county believes 
the participant's substance abuse may limit or 
preclude his or her satisfactory completion of a 
job search. If the case manager believes that 
substance abuse will impair the participant's 
ability to obtain and retain employment, he or 
she must be referred to the county substance 
abuse program for an evaluation to determine if 
treatment is necessary. In such a case, the par- 
ticipant's WtW plan may include assignment to 
a treatment program. 

For example, Los Angeles County's new 
welfare system, CalWORKS, went into effect 
on April 1, 1998. More than $400 billion is ear- 
marked for WtW and administrative services. 
Twenty million dollars is provided for mental 
health services and $40 million for substance 
abuse services. Comprehensive and integrated 
services, such as job training, mental health and 
substance abuse treatment, and skills employ- 
ment, are provided to help people achieve gain- 
ful employment. Los Angeles County's system 
is predicated on moving poor families into jobs. 
The emphasis is on responsibility. New appli- 
cants must sign a contract promising to follow 
an individualized WtW plan. One of these 
WtW programs, GAIN, includes screening as 
one of its features. Applicants who report sub- 
stance abuse or mental health problems are sent 
to an eligibility worker who has specialized 
training in these issues and will schedule a clin- 
ical assessment. 

Orange County implemented its new wel- 
fare program on February 17, 1998. An estimat- 



July3l, 1998 



67 



ed $100 million of State and Federal funds are 
earmarked for welfare reform. Orange County, 
along with San Diego County, is opting for an 
aggressive privatization effort. The county will 
most likely contract with one of the nationally 
known welfare contractors who already work 
for the county. 

Ventura County began implementing its 
welfare reform program in January 1998. 
Employees work in teams in seven one-stop 
career centers that were created across 
the county. Each team serves 1,000 to 1,500 
families. 

A major investment in staff development 
and training has been under way in Sacramento 
county with support from the Annie E. Casey 
Foundation, in 1993, the Department of Health 
and Human Services enacted an initiative to 
incorporate substance abuse services as an inte- 
gral part of its service delivery systems. The 
program has three components: three levels of 
training to develop the ability of social workers, 
public health nurses, eligibility workers, and 
neighborhood-based service staff to provide 
treatment services to substance-abusing clients, 
the expansion of department and community 
resources, including the development of an 
automated service requisition and client track- 
ing system,- and program evaluation including 
both short- and long-term outcomes related to 
family functioning (reduction in Child 
Protective Services referrals and success in com- 
pletion of either voluntary or court-ordered 
treatment plans). 



County 



Section 1 9 i 5(b) - Medi-Cal Specialty Mental Health Services 
Consolidation: With the implementation of the con- 
solidation waiver, counties are responsible for 
authorizing publicly funded inpatient and outpa- 
tient mental health services. Currently, all MHPs 
are county mental health departments, although if a 
county elects not to participate in the program, 
another entity may be the MHR In addition to psy- 
chiatric inpatient hospital services, the county men- 
tal health departments have also historically been 
responsible for Short-Doyle/Medi-Cal (SD/MC) 
services, either by directly providing services or 
through subcontracting. Counties are implementing 



this waiver differently,- most are administering the 
programs themselves, rather than contracting with 
administrative services organizations, with the 
exception of San Diego and Orange Counties. 

Field Tests: In addition to the consolidation 
waiver, two separate managed mental health care 
field tests are currently operating in California 
counties to test managed care concepts that may be 
used as the State progresses toward consolidation 
of mental health services and eventually capitation. 

San Mateo 

Effective April 1, 1995, all Medi-Cal specialty men- 
tal health services, including psychiatric inpatient 
hospital services, were fully consolidated under the 
county mental health department. San Mateo 
County Mental Health directly provides or subcon- 
tracts for the provision of services. San Mateo 
County Mental Health claims the Federal share of 
Medi-Cal funds through existing Medi-Cal systems. 
San Mateo receives an allocation from DMH equiv- 
alent to the historical State/local match for 
Medicaid specialty mental health services. Medi- 
Cal specialty mental health services are reimbursed 
on a case rate basis, except for pharmacy and labo- 
ratory services. Pharmacy and laboratory services 
are authorized by the field test, but the reimburse- 
ment includes a risk corridor delineating State and 
county risk for the State match when federal dollars 
are included. 

Federal reimbursement is obtained through FFS 
billing under the SD/MC system. San Mateo 
County developed its MHP through a participatory 
local public planning process. The MHP is respon- 
sible for all medically necessary specialty mental 
health services to Medi-Cal beneficiaries. Services 
are delivered by a combination of county communi- 
ty-based agencies and traditional providers based 
on a System of Care model. 

The primary issues being field tested by San 
Mateo County are 1) improved access for the con- 
sumer through a centrally administered access sys- 
tem,- 2) a fully consolidated, publicly managed 
MHP for all Medi-Cal beneficiaries,- 3) the defini- 
tion of medical necessity,- 4) a public/private net- 
work service delivery system,- 5) innovative con- 
tracting arrangements, including shared risk con- 
tracting,- 6) a program to ensure adequate interface 
with the primary care system, 7) management infor- 



68 



{SAMHSA} Managed Care Tracking System 



mation needs,- and 8) performance outcomes and 
client satisfaction. 

During the waiver period, the provider network 
was increased to meet service delivery needs. All the 
specialty mental health providers in good standing 
who previously had provided services under the 
County Organized Health System (COHS), a 
county-based managed health care system, were 
invited to participate under the county mental 
health program. The MHP has negotiated contracts 
with seven hospitals, a number of community-based 
agencies, and approximately 1 35 individual mental 
health providers. Quality of services is being mea- 
sured by performance and outcome standards relat- 
ed to access, client utilization, and fiscal impact. 
Client satisfaction is being measured on a regular 
basis through client satisfaction survey and reviews 
of client complaints. 

Solano 



In May 1994, a new COHS was implemented for 
Medi-Cal services (with the exclusion of SD/MC) 
for all beneficiaries. Upon implementation, Solano 
County Mental Health became a subcontractor on 
a capitated basis to the COHS for all specialty men- 
tal health services that were previously provided 
under fee-for-service/Medi-Cal (FFS/MC). The con- 
tract with the COHS places the SD/MC and 
FFS/MC specialty mental health systems under a 
single management. The funds, however, are not 
consolidated and must be accounted for separately, 
as they are still two separate and distinct 
funding systems. Solano County Mental Health was 
required to set up a clear audit trail to ensure that 
capitated funds from the COHS were not being 
used to match Federal funds for SD/MC services. 
Solano County Mental Health retained the respon- 
sibility for SD/MC services, which are reimbursed 
on an FFS basis, and assumes the responsibility for 
FFS/MC specialty mental health services by estab- 
lishing separate provider networks and authoriza- 
tion and payment systems in order to maintain a 
clear audit trail. Administration of the FFS/MC and 
SD/MC funding streams will be integrated when 
both are fully capitated. Solano County Mental 
Health, using capitated dollars from the COHS, 
has contracted with those private providers who 
previously provided services under FFS/MC. 



The primary issues of the Solano County 
Mental Health field test include determining man- 
agement information system needs, medical neces- 
sity standards, techniques for managing the scope of 
benefits, and systems of care design in a managed 
care environment. Solano County Mental Health 
has provided training to other county mental health 
departments and other interested parties regarding 
their experience with capitation and this field test. 

Using a competitive bidding process, Solano 
County Mental Health developed a contract with a 
private managed care company to assist with the 
implementation and management of the capitated 
services. This public/private partnership has already 
produced some helpful information for other coun- 
ties to consider as they make the transition to capi- 
tation with respect to strengths and limitations of 
private behavioral health firms, in areas such as 
provider relations, information systems, and utiliza- 
tion management. 

Solano County Mental Health also contracts 
with a private, for-profit health maintenance orga- 
nization (HMO) on a capitated basis to provide 
mental health services (excluding SD/MC services) 
for Medi-Cal recipients who select the HMO as 
their primary health care provider. 

Evaluation Findings 

• The Latino Coalition for a Healthy California 
issued a report that finds Medi-Cal's managed 
care program to be "rife with deficiencies" that, 
"combined with upheaval fostered by Federal 
welfare reform, endangers basic health care ser- 
vices to impoverished Latinos and other minori- 
ties." Los Angeles is especially precarious,- the 
report finds "inadequate translation of enroll- 
ment materials, poor or inaccurate beneficiary 
education, botched or questionable patient 
enrollment practices, and paltry payments and 
support for doctors and hospitals that were the 
backbone of the old Medi-Cal system." 

• A Survey of Consumer Experience with 
Managed Care conducted in the Sacramento 
area found that the majority of Sacramento 
managed care consumers cited no difficulties 
with their health insurance in the previous 
year, but that a quarter (27 percent) had prob- 
lems. Medi-Cal beneficiaries were more likely 
than others to report problems, with 42 per- 



July 31, 1998 



69 



cent of the Medi-Cal beneficiaries surveyed 
citing difficulty with a managed care plan in 
the previous 12 months. 

The General Accounting Office released a 
report in October 1997 that investigated 1) 
the implementation status of California's man- 
aged care expansion, including identifying the 
primary causes of delays,- 2) the degree to 
which State efforts to educate beneficiaries 
about their managed care options and enroll 
them in managed care have encouraged bene- 
ficiaries to choose a plan,- 3) the management 
of the State's education and enrollment 
process for the new program, including State 
and Federal oversight of enrollment brokers 
that the state contracted with to carry out 
these functions,- and 4) the impact of the man- 
aged care expansion on current safety net 
providers, such as community health centers. 
Their investigation found that California's 
implementation of its 12-county expansion 
program is more than 2 years behind schedule 
and is still incomplete. Additionally, the report 
concluded that the State may have moved too 
quickly in moving Medicaid recipients into a 
new system of care. The study showed that 



recipients were confused by unclear educa- 
tional material and lack of communication, 

• The University of California at Berkeley, 
commissioned by the Governor's Managed 
Care Task Force, conducted a study on HMO 
enrollees' experiences by condition. The study 
found that in the case of depression, 19 per- 
cent of respondents claimed they did not get 
appropriate care and 26 percent said their 
health plan didn't cover the benefits they 
needed. 

• Sacramento County Welfare Reform Plan: By 
January 1997, more than 1,200 health and 
human services staff members had participated 
in the training with positive effects shown on 
the interim evaluation. The net effect for 
Sacramento County has been an increase in 
substance abuse treatment slots, significantly 
reducing waiting lists. 

Other Quantitative Data 



In 1990, California's health care bill was estimated 
to be $80 billion,- direct cost of treating all mental 
disorders was estimated to be 10 percent or $8 
billion. 



70 



{SAMHSA} Managed Care Tracking System 



COLORADO 



OVERVIEW 



Colorado currently operates a capitated statewide managed care program for Medicaid mental health 
services. Medicaid substance abuse services remain in the fee-for-service (FFS) system (only detoxifi- 
cation is provided under a physical health managed care program). 

Services under the mental health waiver are provided by nine Mental Health Assessment and 
Service Agencies (MHASAs) which are organized in one of four different models: community men- 
tal health centers (CMHCs) operating independently, a CMHC consortium, partnerships between a 
behavioral health managed care organization (BHMCO) and community mental health centers, and 
a nonprofit health maintenance organization (HMO) with an administrative services organization 
(ASO) arrangement. 

Under another waiver program, one county is operating a pilot project that integrates mental 
health services for the young and elderly disabled populations. 




Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 

Section 1915(b) - Colorado Mental Health Capitation and Managed Care Progran) (Mental Healdi): mental 
health stand-alone: mental-health-specific; substance abuse services reimbursed on an FFS basis. 
Section 1115- Integrated Care and Financing Pilot Project - integrated: mental health services for the 
elderly and younger disabled. 

Medicaid Voluntary 
Not applicable. 




Other Managed Care Programs 
Not applicable. 



Geographic Location 



Section i9i5[b] - Mental Health: Statewide. 

Section ms - Integrated Care and Financing Pilot 
Project: Mesa County (Grand Junction). 

Status of Programs 

Section i9i5(b) - Mental Health: Approved October 
1993; implemented August and September 1995, 
waiver end date June 30, 1997. State submitted a 
renewal June 1997. This renewal was approved 
March 1998 and expires March 8, 2000. 

Section ms - Integrated Care and Financing Pilot 
Project: Approved August 1 997. 



Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Detoxification (inpatient hospitalization). 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Inpatient; outpatient; pharmacy (includes manage- 
ment); mental health support (e.g., case manage- 
ment, personal care); crisis (e.g., emergency ser- 
vices); rehabilitation (e.g., home health). 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section i9i5[b) - Mental Health: Covers addiction dis- 
order services only as the services may overlap with 
mental health services. 



July 31, 1998 



71 



Section Hi 5 - Integrated Care and Financing Pilot 
Project: Unknown. 

Medicaid Mental Health Services in 
Managed Care Plan 



Section i9i5[b) - Mental Health-. Covered services 
include inpatient (e.g., hospital services, institution 
for Mental Diseases services for individuals under 
age 21 and over age 65)- outpatient,- residential 
(e.g., 24-hour residential care), mental health sup- 
port (e.g., physician services, case management, 
respite care, family preservation services, family 
education and training services, translation/interpre- 
tive services for mental health diagnosis and care, 
vocational and prevocational services),- rehabilita- 
tion (e.g., psychosocial), crisis (e.g., 24-hour emer- 
gency services). 

Section iH5 - Integrated Care and Financing Pilot 
Project: Unknown. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid MentaS Health Services in 
Managed Care Plan 



Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Section i9i5[b) - Mental Health: Prevention services are 
covered under Colorado's physical health managed 
care plan. HMOs are required to provide the fol- 
lowing services to treat pregnant substance abusing 
women: health education for mother and child, par- 
enting skills, and life skills education. 

Section iiis - Integrated Care and Financing Pilot 
Project: Unknown. 

Populations Covered Under Managed 
Behavioral Health 



Section i9{5[b] - Mental Health: Adults and children 
mandatory: Aid to Families with Dependent 
ChildrenAemporary Assistance for Needy Families, 
Supplemental Security Income, dually eligible, fos- 
ter care children. 



Section iiiS - Integrated Care and Financing Pilot 
Project: Voluntary: Elderly, younger disabled, dually 
eligible (Medicare/Medicaid). 

State Managed Care Program 
Administration 



Section i9i5[h) - Mental Health: The Medicaid waiver 
program is administered by the Department of 
Human Services, Mental Health Services (MHS) 
under a written memorandum of understanding 
with the Department of Healthcare Policy and 
Financing, the State Medicaid agency. The nine 
MHASAs are organized under four different 
models: 

1. Independent CMHCs. CMHCs operating 
independently as MHASAs are responsible for 
both administration and service delivery. 

2. CMHC consortium. A separate entity was 
formed by three CMHCs to operate as a single 
MHASA. The CMHCs were essentially forced 
together when the State combined their respec- 
tive service areas into one managed care region. 
Behavioral Healthcare Incorporated (BHl) 
bears full financial risk and acts as a BHMCO. 
BHI processes claims, authorizes services, and 
credentials providers. Management information 
services (MIS) are contracted out to a private 
data service. BHI pays State hospitals a capitat- 
ed rate and negotiates FFS payments with both 
private hospitals and providers. 

3. Public/Private partnership between BHMCO 
and CMHC. Colorado Health Networks con- 
sists of three limited liability corporations 
(LLCs) that provide care in 43 of the State's 63 
counties. Each of the three LLCs is composed 
of a partnership between the CMHC in the 
region and a private BHMCO. One service 
center serves all three LLCs. Typically, the 
CMHC provides mental health services, triages 
patients, and makes referrals for services not 
offered by the network. The BHMCO provides 
MIS, claims processing, utilization review, uti- 
lization management, and other administrative 
services. The LLC partnership's board has equal 
representation of provider/BHMCO members. 
The boards are responsible for State guidelines. 
State contracting, setting general policies, over- 
seeing quality improvement, and approving 



72 



{SAMHSA} Managed Care Tracking System 



budgets for care, administration, and reinvest- 
ment of savings. The partnership's contract with 
the State stipulates that profits must be rein- 
vested. 

4. HMO with an ASO arrangement. The State's 
largest HMO providing physical health ser- 
vices to Medicaid recipients is the newest 
model to roll out. It is different from the rest of 
the State in that the State has contracted with a 
nonprofit HMO, rather than a nonprofit com- 
munity mental health center as is done in the 
other parts of the State (see 1 through 3 above). 
A private for-profit managed care organization 
will be the ASO in this area of the State 
(Denver). The HMO will subcontract with sev- 
eral of Denver's behavioral health care 
providers, including the area's largest behavioral 
health care provider, MH Corporation (MHC) 
of Denver. MHC will have a partner role, 
including a seat at the policy table to influence 
the contractor's policy decisions. MHC will 
also receive 46 percent of the Medicaid reim- 
bursement under the contract. 

Under these arrangements, the State Mental 
Health Agency is responsible for policy develop- 
ment, administration, and programmatic oversight 
for the public and community mental health system. 
MHASAs are responsible for providing a full range 
of services and must maintain flexibility to offer new 
service options not previously available to the 
Medicaid population. They are responsible for 
coordinating, managing, and delivering mental 
health services to all eligible people in their regions. 
All MHASAs must have a state insurance license, 
which requires reserves equal to one-twelfth of the 
projected premiums. CMHCs have their own gov- 
erning boards. Each CMHC has a geographic ser- 
vice area, but only 1 of 17 is a part of county gov- 
ernment. 

Section ms - Intepated Care and Financing Pilot 
Project: The Health Care Policy and Financing 
Department contracts with one private, for-profit 
HMO to operate the pilot project. 

Financing of Plans 

Section i9i5[b] - Mental Health: This program Is 
financed by Medicaid dollars. The MHASAs are at 
full risk. Each MHASA is paid a per-person per- 



month capitated rate, which varies by geographic 
region and Medicaid eligibility group. Rates are 
based on historical costs of the FFS system. 
MHASAs pay network providers FFS. All MHASAs 
are limited to a before-tax profit of 5 percent of total 
revenues. 

With regard to the public/private LLC partner- 
ship between the BHMCO and CMHC, Colorado 
pays a monthly capitation payment to the LLC. The 
LLC provides a budget for managed care adminis- 
tration services, which is paid to the BHMCO, and 
a budget for claims targets, which is paid to the 
CMHC. The CMHC pays its internal providers, 
and the BHMCO pays the external providers with 
this budget. A minimum percentage of what is taken 
in by the LLC and any surpluses from the two other 
budgets goes to a risk/reward pool. TTie partners are 
at direct risk for a limited amount after depletion of 
the risk fund, but before the aggregate stop-loss or 
excess risk coverage becomes active. The 
risk/reward pool is shared according to a negotiated 
formula. 

Section Hi 5 - Integrated Care and Financing Pilot 
Project: Unknown. 

Coordination Between Primary and 
Behavioral Health Care 



Section i9l5(b] - Mental Health: Medicaid recipients 
continue to receive their physical and other health 
services from their Medicaid HMO or primary care 
physician under the Primary Care Physician Plan 
(PCPP), while their mental health services are coor- 
dinated, provided, or arranged for by their desig- 
nated MHASA. While there is no formal relation- 
ship between the MHASAs and the providers in the 
PCPP, the MHASAs are required to develop and 
implement systems for coordinating the mental and 
physical health care of the Medicaid recipients in 
their service areas. Some have written agreements 
with MCOs, but this is largely done on an individ- 
ual basis. 

Additionally, MHASAs have strong incentives 
to find appropriate placements quickly and must 
work with the child welfare system to access these 
placements,- child welfare agencies must work with 
the MHASAs to access needed inpatient hospital 
services and mental health services for children 
once they are in residential placements. 



July 31, 1998 



73 



Consumer^Family Involvement 



Section i9i5[b) - Mental Health: Consumer and family 
involvement at this phase of the waiver has been 
extremely high vi^ith significant, ongoing involve- 
ment. 

Section ms - Integrated Care and Financing Pilot 
Project: Unknown. 

Future Plans 

Section i9i5[b] - Mental Health: By July 1, 2000, 
Colorado will have to re-bid the entire State under 
the Mental Health capitation program. 

Section ms - Integrated Care and Financing Pilot 
Project: State plans to expand program statewide. 

* New Program Under Development: United 
Healthcare of Colorado is launching a State health 
plan for the dually eligible (Medicare/Medicaid) 
that will operate in the Denver metro area. 

State Agency Adnninistratlon 



Colorado's Alcohol and Drug Abuse Division and 
MHS fall under the auspices of the Department of 
Human Services. The Medicaid program falls under 
the Department of Health Care Policy and 
Financing. 

Welfare Reform 



Colorado's welfare reform program emphasizes self- 
sufficiency through employment. An initial assess- 
ment of family need for services, skills, prior work 
experience, and employability is conducted for each 
individual. The assessment includes identification of 
domestic violence. Drug testing is not mandatory,- 
however, convicted drug felons do not receive assis- 
tance unless they have taken steps toward rehabili- 
tation. Each recipient must complete an Individual 
Responsibility Plan (IRP). Anyone who refuses to 
participate in the assessment or does not fulfill the 
responsibilities of their IRP will not be eligible for 
cash assistance. 

County 



Several community mental health centers in 
Colorado have organized a consortium to partici- 
pate in the State's mental health capitation pro- 
gram. Three CMHCs formed BHI, a separate enti- 
ty, to bear risk and act as a behavioral health orga- 



nization. The partnership formed to avoid overlaps 
in service areas and cost shifting between service 
areas. BHI processes claims, authorizes services, 
and credentials providers. MIS are contracted out 
to a private data service. BHI pays State hospitals a 
capitated rate and negotiates FFS payments with 
private hospitals and providers. CMHCs are at full 
risk in their State contracts and are required to put 
up a bond equal to one-twelfth of the projected 
premiums. In addition, they must qualify as a spe- 
cial type of entity, similar to an HMO as defined 
under State regulations. 

Evaluation Findings 

Section i9i5[b] - Mental Health: Total estimated sav- 
ings from the pilot project from August 1995 
through June 1996 were $6.5 million. The average 
cost per unduplicated client without inpatient 
costs was $2,449, compared with $3,103 before 
the pilot. 

MHS conducts regular site visits to monitor 
contractor activities and operations. MHS is 
responsible for ensuring that all necessary mental 
health services are delivered, that the quality of ser- 
vices delivered meet minimum standards, and that 
access to services is consistent with level of need. 
The Institute for Mental Health Services Research 
has been contracted to conduct an independent 
evaluation of the pilot program. 

MHS contracted for a separate evaluation of 
children's services under the pilot program as well as 
a follow-up study of all children and adolescents 
who were discharged from the two State Mental 
Health Institutes during the first 2 months of the 
pilot program. In the follow-up study, researchers 
focused on whether discharge placements under the 
capitated system fit the needs of youths. They 
found that the settings where youth were placed 
immediately upon discharge did not meet their 
needs in roughly half the cases. Thus, capitation 
during the first 2 months of implementation did not 
substantially alter the number of children who were 
placed in suitable settings immediately upon dis- 
charge. Four months after discharge, however, more 
parents and clinicians/case managers felt that the 
placement of youths fit their needs. Other findings 
included the following; 

• Youth who were discharged during early capita- 
tion improved in fewer areas of functioning 



74 



{SAMHSA} Managed Care Tracking System 



while hospitalized compared with youth dis- 
charged in the previous year,- and 

• Although parents felt the youth were ready for 
discharge, clinicians/case managers and parents 
in both years were dissatisfied with the fit of 
their child's initial discharge placement in half 
the cases. 

Consumer Satisfaction Survey of Adults Served by the 
Colorado Mental Health System: Colorado Mental 
Health Services mailed a consumer satisfaction sur- 
vey to a random sample of Medicaid recipients 
identified through mailing lists of CMHCs. Tlie 
results were fairly positive. Consumers reported the 
greatest satisfaction with services, locations and 
hours services were available, staff competence, and 
respect for consumers' rights. The average overall 
satisfaction ratings fell between satisfied and neu- 
tral. No differences in satisfaction were found based 
on age or gender. However, with respect to ethnic- 
ity, Latino/Hispanic consumers reported higher sat- 
isfaction than other groups. Preliminary analysis of 
satisfaction related to the type of services received 
found no statistically significant differences in over- 
all satisfaction, although those receiving residential 
and day treatment services reported the highest lev- 
els of satisfaction. 

Other Quantitative Data 

Not applicable. 



July 3 1, 1998 75 



CONNECTICUT 



OVERVIEW 



Connecticut currently operates a managed care program that includes mental health and substance abuse ser- 
vices under a 1915(b) Medicaid waiver. Additionally, the Department of Social Services (DSS) and the 
Department of Mental Health and Addictions Services (DMHAS) are in the beginning stages of implement- 
ing a utilization management program for behavioral health services to the general assistance (GA) (town- 
administered) and State-administered general assistance (SAGA) populations, under an administrative services 
organization (ASO) model. 

Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 

Section 1915(b) - Connecticut Access - integrated: Acute mental health and substance services are pro- 
vided as part of physical health services. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

GA Behavioral Healtli Managed Care Progran) - behavioral health stand-alone:Through an interagency 
agreennent between the DSS and the DMHAS, mental health and substance abuse services will be 
provided to the GA and SAGA populations under a managed care program. 




Geographic Location 



Section i9i5[b] - Connecticut Access: Statewide. 

GA Behavioral Health Managed Care Program: GA: 
Norwich; SAGA; 1 1 municipalities. 

Status of Progranns 

Section i9i5(b] - Connecticut Access- Submitted 
February 1995,- approved July 1995, implemented 
February 1, 1997. 

GA Behavioral Health Managed Care Program: ASO 
arrangement will begin October 1, 1998. 



Medicaid Mental Health Services 
Remaining Fee-For-Service 

Inpatient, outpatient. Institution for Mental 
Diseases (IMD) services for individuals age 65 and 
over and age 2 1 and under. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section i9i5(h) - Connecticut Access: The following sub- 
stance abuse services are covered: Acute detoxifica- 
tion, opiate treatment, outpatient. 



Medicaid Substance Abuse Services 
Remaining Fee-For^Service 

Acute detoxification, outpatient detoxification, opi- 
ate treatment, outpatient. 



Medicaid Mental Health Services in 
Managed Care Plan 



Section i9i5[b) - Connecticut Access.- The following 
mental health services are covered: Inpatient, out- 
patient, pharmacy, IMD services for individuals age 
65 and over and age 21 and under. 



July 31, 1998 



77 



Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

GA Behavioral Health Managed Care Program: Acute 
detoxification, opiate treatment, outpatient, resi- 
dential. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

GA Behavioral Health Managed Care Program: Inpatient, 
outpatient, crisis, and partial hospitalization. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section i9i5[b) - Connecticut Access: Early and periodic 
screening, diagnosis, and treatment, dental, vision, 
hearing, and other preventive services. 

GA Behavioral Health Managed Care Program: None. 

Populations Covered Under Managed 
Behavioral Health 



Section i9i5[h') - Connecticut Access: Mandatory adults 
and children: Aid to Families with Dependent 
ChildrenAemporary Assistance for Needy Families 
(AFDC/TANF), pregnant women and children up to 
200 percent Federal poverty level (FPL), uninsured 
children (including foster care children) up to 185 
percent FPL,- uninsured children above 1 85 percent 
FPL covered under the State's Children's F4ealth 
Insurance Program (CHIP). 

GA Behavioral Health Managed Care Program: GA 
and SAGA populations. Income eligibility is deter- 
mined by comparing the individual's available in- 
come to the payment standard, FPL does not apply. 

State Managed Care Program 
Administration 

Section i9i5[h] - Connecticut Access: Currently, the DSS 
contracts with seven private, for-profit health main- 
tenance organizations (F4MOs) and two federally 
qualified health centers on a fully capitated basis. 
Five plans subcontract with a behavioral health 
managed care organization for behavioral health 
services, and two provide services directly. 
Medicaid is responsible for monitoring, and the 
HMOs are responsible for coordinating and provid- 
ing direct services. 



The provider network is closed,- plans are 
required to use school-based health centers and 
child guidance clinics as part of the traditional com- 
munity provider network. 

Plans are mandated to contract with Medicaid- 
reimbursed school-based clinics to refer emotional- 
ly disturbed children to guidance centers or alterna- 
tive providers if plans don't provide these services 
themselves. The plans are responsible to DSS for 
their providers and subcontractors. 

GA Behavioral Health Managed Care Program: 
Currently, an interagency agreement between DSS 
and DMHAS has been established to govern the 
transition and ongoing coordination of behavioral 
health services to recipients of SAGA and GA pro- 
grams. DMHAS contracted with an ASO to provide 
claims process and utilization management for sub- 
stance abuse treatment as well as mental health ser- 
vices for the GA population. 

Currently, DMHAS uses Medicaid, DMHAS- 
contracted providers, and State-operated facilities 
to deliver behavioral health services. During the fall 
of 1998, providers will be credentialed. Providers 
will not contract with the ASO but with DMHAS. 

DSS played a strong role, in concert with its 
provider system, in guiding this program, it is work- 
ing toward establishing criteria for diagnoses, 
length of stay, and level of care determinations, and 
setting new rate structures. 

DSS is responsible for providing space and 
equipment, supplying security and parking, and 
working collaboratively with DMHAS workers for 
the mutual benefit of SAGA and GA recipients. 
DMHAS' responsibilities include providing services 
to SAGA/GA clients either directly or through re- 
ferrals, staffing, supervising, authorizing services, 
processing claims, and working collaboratively with 
DSS. 

Financing of Plans 

Section i9i5[h) - Connecticut Access.- This program is 
financed through Medicaid dollars. HMOs are paid 
a capitated rate based on 92.5 percent of historical 
fee-for-service (FFS) per capita expenditures. Plans 
are required to purchase private insurance in order 
to pass through the Request for Applications 
process. The State assumed a 5 percent managed 
care savings. Plans are fully capitated, with school- 



78 



{SAMHSA} Managed Care Tracking System 



based child health services for children with special 
health care needs and Part H early intervention ser- 
vices excluded from the capitated rates and paid on 
an FFS basis. If a plan generates a profit, there are no 
mandates on how these profits are allocated. 

GA Behavioral Health Managed Care Program: 
DMHAS received an appropriation for managed 
behavioral health care for the State's GA recipients. 
The ASO and provider network will not be put at 
risk. Services will be reimbursed on an FFS basis. 
Providers will be paid from a Connecticut Treasury- 
approved ASO bank account. 

Coordination Between Primary and 
Behavioral Healthy Care ^ 

Section i9i5[b] - Cottnecticut Access: Coordination is up 
to the individual health plans. Standard managed 
care utilization review is used. 

GA Behavioral Health Managed Care Program: Not 
applicable. 

Consumer-Fannlly Involvement 



Section i9i5(h) - Connecticut Access- Consumers and 
families are members of an advisory council that is 
currently active, even upon implementation of the 
waiver In addition, the State legislature gave money 
to the Child Health Council to monitor the impact 
of the program on children. Also, an enrollment 
broker arranged for a family advisory group to 
empower families of consumers accessing behav- 
ioral health services. 

GA Behavioral Health Managed Care Program: 
Consumers and family members played a role in the 
design of the program. Additionally, DMHAS has a 
very active consumer council to advise on the 
implementation and operation of the program. 

Future Plans 

Section i9i5(h] - CoMMecfiCMt Access. The dually eligible 
(Medicaid/Medicare) are expected to be phased in 
within 2 years. 

GA Behavioral Health Managed Care Program: The 
ASO arrangement will begin October 1, 1998. 

* New Program Under Development The HUSKY 
plan (CHIP) will sewe children from 185 to 300 
percent FPL. Inpatient and outpatient mental health 
and substance abuse services will be provided. Two 



additional initiatives within the HUSKY plan 
administered by the Yale Child Study Center 
include children in need of intensive behavioral 
health services and children with special physical 
health needs. These two programs fall under the 
auspices of HUSKY Plus. The infrastructure of 
Child Guidance Clinics, Family Service Agencies, 
and Youth Service Bureaus will be used. 

Providers will be paid from a combination of 
supplemental grants and direct service dollars to 
provide care coordination, case management, and 
direct services. Programs will be administered by 
Title V administration. The program is expected to 
be implemented July 1, 1998. 

State Agency Administration 

DSS houses the Medicaid agency, and DMHAS 
houses the Mental Health and Substance Abuse 
agencies. 

Welfare Reform 



Under Connecticut's welfare reform plan, women 
who receive AFDC or GA funds and enter sub- 
stance treatment without their children must forfeit 
all welfare benefits. Women who enter substance 
abuse treatment with their children must pay part of 
the cost of their treatment (generally, one-third of 
the total cost). Women who have children and are 
enrolled in a job-training program receive a cash 
stipend to be used toward child care expenses. 
Women with children who are receiving substance 
abuse treatment services are given no child care 
stipend. Additionally, Connecticut does not man- 
date drug testing for all welfare beneficiaries. TANF 
is not denied to drug felons. 

Recently, Connecticut cut off welfare to hun- 
dreds of families who reached the State's 21 -month 
time limit. This process is expected to eliminate 
one-fifth of the State's welfare caseloads by 
November 1998. 



County 

Not applicable. 



July 31, 1998 



79 



Evaluation Findings 

Section i9i5(b] - Connecticut Access: For the first waiver, 
DSS (in conjunction with EQRO (external quality 
review organization) and the Child Health Council) 
collected encounter data to monitor the quality of 
care provided by both types of health plan, basing 
the indicators monitored on HEDIS (Health 
Employer Data and information Set). Monthly 
reports are provided to the advisory council (see 
Consumer-Family Involvement Section). 

Other Quantitative Data 

Not applicable. 



80 {SAMHSA} Managed Care Tracking System 



DELAWARE 



OVERVIEW 



Delaware's Diamond State Health Plan provides a basic benefit plan that includes medical and limit- 
ed mental health/substance abuse benefits through a managed care delivery system. Specialty men- 
tal health and substance abuse services for children with severe emotional disturbance (SED) are par- 
tially carved out and managed by a public sector managed care organization (MCO) (the 
Department of Services for Children, Youth, and their Families (DSCYF), Division of Child Mental 
Health Services (DCMHS)). 

For adults, limited mental health and substance abuse treatment services are included in the 
Diamond State Health Plan. Mental health and substance abuse services for adults with severe and 
persistent illness are provided through the Department of Health and Social Services (DHSS) 
Division of Alcoholism, Drug Abuse, and Mental Health (DADAMH), through State-operated and 
contractual programs. 

Additionally, DSCYF operates a child welfare demonstration to provide behavioral health ser- 
vices to families whose children might otherwise be placed in out-of-home care. 

Managed Care Programs for Behavioral Health Services 




Medicaid Waivers 

Section 1115- Diamond State Health Plan - partial carve-out: Integrates basic mental health and sub- 
stance abuse services; specialty mental health and substance abuse services are carved out for chil- 
dren and fee-for-service (FFS) for adults. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

Child Welfare Demonstration - integrated: Provides assisted guardianship placements for children who 
cannot be reunited with their parents, as well as substance abuse treatment for parents to reduce the 
need for foster care placements. 



Geographic Location 



Section ms - Diamond State Health Plan: Statewide. 
Child Welfare Demonstration. Statewide. 

Status of Programs 

Section Hi5 - Diamond State Health Plan-. Submitted July 
27, 1994; approved May 16, 1995; implemented 
January 1, 1996. 

Child Welfare Demonstration: Approved June 17, 
1996. 



Medicaid Substance Abuse Services 
Remaining Fee-For-Service 



The Delaware Medicaid program covers the fol- 
lowing substance abuse services: Acute, subacute, 
and ambulatory detoxification; opiate treatment; 
outpatient; inpatient; transportation. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

The Delaware Medicaid program covers the fol- 
lowing mental health services: inpatient, outpa- 
tient, pharmacy, mental health support, Institution 
for Mental Diseases waiver services for those under 
age 2 1 . 



July 31, 1998 



81 



Medicaid Substance Abuse Services in 
Managed Care Plan 



Section Hi5 - Diamond State Health Plan: Basic Plan: For 
children: outpatient up to 30 units. For adults: inpa- 
tient services up to 30 units and outpatient services 
up to 20 units. 

Specialty Plan: For children: Inpatient,- acute, 
subacute, and/or ambulatory detoxification,- opiate 
treatment; residential. For adults: Specialty sub- 
stance abuse services not included in the managed 
care program. 

Medicaid Mental Health Services in 
Managed Care Plan 



Section iiis - Diamond State Health Plan: Basic Plan: For 
children: Outpatient up to 30 units, emergency 
transportation. For adults: Inpatient services up to 
30 units and outpatient services up to 20 units,- 
emergency transportation. 

Specialty Plan: For children: Inpatient, crisis, 
mental health support, mental health rehabilita- 
tion, residential. For adults: After 30 visits if an 
individual is not determined to have severe and 
persistent illness (SPI), the individual is served in 
one of the Division's programs with non-Medicaid 
funding. For those with SPI, the individual is served 
in one of the Division's programs with Medicaid 
funding. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Child Welfare Demonstration: Unknown. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Child Welfare Demonstration: Unknown. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Section Hi5 - Diamond State Health Plan: Early and peri- 
odic screening, diagnosis, and treatment (EPSDT),- 
routine physicals,- immunizations. 

Child Welfare Demonstration: EPSDT. 



Populations Covered Under Managed 
Behavioral Health 

Section iiis - Diamond State Health Plan: Mandatory 
adults and children: Aid to Families with Dependent 
ChildrenATemporary Assistance for Needy Families 
(AFDC/TANF), uninsured (up to 100 percent 
Federal poverty level (FPL)), Supplemental Security 
Income, adults (up to 100 percent FPL),- pregnant 
women (up to 185 percent FPL),- children age 0—1 
(up to 185 percent FPL),- children age 2-5 (up to 
1 33 percent FPL), children age 5-1 8 (up to 100 per- 
cent FPL). 

Child Welfare Demonstration: Foster children,- chil- 
dren at risk for out-of-home placement and their 
parents. 

State Managed Care Program 
Administration 



Section ms - Diamond State Health Plan: The Diamond 
State F4ealth Plan is a public/private partnership 
composed of three commercial MCOs and one 
public sector MCO. Medicaid contracts with the 
commercial MCOs to provide services in the basic 
benefit package. Commercial MCO responsibilities 
include delivery of acute physical and behavioral 
health services. Two of the three commercial 
MCOs subcontract with behavioral health service 
companies to provide the services. The third com- 
mercial MCO contracts on an FFS basis with com- 
munity providers. The MCOs may contract exclu- 
sively as long as all necessary services are provided 
by the contracting network. 

The role assigned by the 1115 Medicaid Waiver 
for DSCYF is that of a public MCO, to partner with 
the private MCOs. Affiliation agreements between 
DSCYF and each of the MCOs have been estab- 
lished. After the adult or child exhausts the inpa- 
tient and outpatient units, DCMF4S and DADAMF-I 
oversee the provision of services beyond those 
offered by the MCOs in the basic benefit package. 

Child Welfare Demonstration: DSCYF administers 
the child welfare demonstration. Delaware staffs 
joint child protective services and substance abuse 
teams to provide services to families whose children 
might otherwise have to be placed or remain in fos- 
ter care. 



82 



{SAMHSA} Managed Care Tracking System 



Financing of Plans 

Section ms - Diamond State Health Plan: Basic Plan: 
The MCOs are fully capitated, at risk, and paid by 
the Medicaid Office DHSS, Division of Social 
Services. All services in the managed care benefit 
package are paid by monthly capitation payments 
based on the State's previous FFS Medicaid experi- 
ence trended to rate year and adjusted for expected 
effects of managed care on utilization and expendi- 
tures. MCOs must self-insure or purchase private 
insurance,- the State does not engage in risk sharing 
through stop-loss or risk corridors. 

The providers in the Diamond State Health 
Plan are at full risk for the populations served. The 
MCOs may negotiate the type of contract with 
their providers. Capitation rates for the Diamond 
State Health Plan v/ere calculated with anticipated 
savings. There are no restrictions on how any other 
savings must be used by the MCOs or mandates on 
profit allocation. 

Partial carve-out for SED children: A "bundled 
rate" has been established as the new method of 
payment by the Medicaid Office for the services 
delivered to Medicaid-eligible children by 
DCMHS. This is paid on a per-member per-month 
basis for each Medicaid child receiving a service 
during that month. In the future, DSCYF will estab- 
lish a set capitation rate for every Medicaid-eligible 
child. 

Child Welfare Demonstration: This program is fund- 
ed through Federal foster care Title IV-E funds. 

Coordination Between Primary and 
Behavioral Health Care 

Section ms - Diamond State Health Plan: For adults, pri- 
mary or specialty physical health care services are 
coordinated according to each MCO's policy and 
procedures. Care for children is coordinated on a 
case-by-case basis. 

Child Welfare Demonstration: Unknown. 

Consumer^Family Involvement 

Section ms - Diamond State Health Plan: The Medicaid 
Managed Care steering committee had large repre- 
sentation of mental health and substance abuse 
consumers. Its focus was on the implementation of 
the Diamond State Health Plan. Upon implemen- 
tation, however, the committee's work was com- 



pleted, and consequently, the committee no longer 
meets. 

Child Welfare Demonstration: Unknown. 

Future Plans 

Section iiis - Diamond State Health Plan: The Diamond 
State Health Plan will incorporate the Title XXI 
Children's Health Insurance Program (CHIP) (see 
below for description). 

* New Program Under Development: DHSS is cur- 
rently undertaking a feasibility study on long-term 
managed care. Populations/groups included in the 
feasibility study are all individuals receiving long- 
term care services by the Department, such as the 
elderly and persons with physical disability, mental 
retardation, severe and persistent mental illness, and 
alcoholism or drug addictions. 

Based on the results of the feasibility study, the 
State decided to develop a Managed Long-term 
Care Program for its 1915 populations and the dual 
eligibles. Program components are being developed 
for older adults and adults with behavioral health 
problems. It is anticipated that a full request for pro- 
posals (RFP) and waiver initiative will begin in late 
1998 or early 1999. 

* New Program Under Development: Delaware 
released an RFP due April 1 3, 1998, for Adults with 
Severe Developmental and Behavioral Disabilities 
in the Adult Special Populations Program. 

* New Program Under Development: An insured 
program for children using Federal CHIP funding 
will provide services to children up to age 19 not 
qualified for Medicaid but below 200 percent FPL. 
These children will be able to enroll in a managed 
care plan. The State will use $8.1 million in Federal 
funds and $3.5 million in State funds to finance the 
program. The proposal for this program was due 
July 1, 1998. The program is expected to begin 
January 1999, depending on Federal approval 
process. 

State Agency Administration 



The DHSS houses the Medicaid agency as well as 
the Mental Health and Substance Abuse agencies 
for adults. The Division of Social Services (DSS), 
Office of Medicaid represents the Medicaid agency. 
DADAMH serves adults. The DSCYF and 
DCMHS serve children and adolescent mental 
health and substance abuse needs. 



July 31, 1998 



83 



Welfare Reform 

Delaware negotiated an interagency partnership 

with the substance abuse agency (DADAMH) to 
provide substance abuse intensive case management 
and intervention services for TANF recipients. 
TANF funds will be used to support the "Bridge 
Agency" project. 

Currently, under the Personal Responsibility 
and Work Opportunities Reconciliation Act, drug 
testing is not mandatory and those TANF eligible 
individuals who commit a drug felony will be 
denied coverage. 

• Delaware's statewide reform project, A Better 
Chance Welfare Reform Program, includes a 2- 
year time limit on cash assistance, required 
school attendance for dependent children and 
minor parents, a family cap, a required contract 
of mutual responsibility and related work 
requirements, and required immunizations. 
Recipients have access to information on family 
planning services, domestic violence interven- 
tion, and substance abuse treatment. 

A Better Chance also includes an initiative for 
parenting, employment, and training for absent 
fathers; individual savings accounts and the ability 
for clients to retain a portion of their grants while 
working; elimination of the 100-hour rule and 
other barriers for two-parent families; and ongoing 
child care and health care coverage, including 
counseling, for clients who leave welfare to work. 

Also, under this program, two DHSS 
Divisions — DADAMH and DSS — are linked 
together to develop a process of identifying and 
serving welfare recipients in need of mental health 
and substance abuse services. These individuals 
will have access to the basic behavioral health care 
benefit package under the Diamond State Health 
Plan, individuals can be sanctioned for not com- 
plying with substance-abuse-related requirements. 



• Delaware's Welfare to Work grant submitted to 
the U.S. Department of Labor on February 19, 
1998, is pending approval. This grant will be 
administered by DSS, within DHSS, One hun- 
dred percent of matching funds will come from 
the State. The intended use of 15 percent State 
project funds will be based upon innovative 
proposals by public/nonprofit and private orga- 
nizations that show promise in moving the 
most-difficult-to-employ long-term welfare 
recipients into unsubsidized employment. The 
State's welfare reform program, A Better 
Chance, will coordinate efforts to link Welfare 
to Work entities with local TANF agencies. 
Performance measures from A Better Chance 
will be used. 

County 

Not applicable. 

Evaluation Findings 

Section Hi5 - Diamond State Health Plan: Plans must 
track and seek to improve health outcomes based on 
EPSDT guidelines developed by U.S. Preventive 
Services Task Force. Plans are required to conduct 
annual satisfaction surveys. Plans must submit semi- 
annual reports on quality assurance activities and 
results (including HEDIS (Health Employer Data 
and Information Set) and other clinical outcomes 
measures). 

Specifically, the State and State's contracting 
MCOs conducted a consumer satisfaction survey in 
1997 using 1996 data. 

Other Quantitative Data 

Not applicable. 



84 



{SAMHSA} Managed Care Tracking System 



DISTRICT OF 
COLUMBIA 



OVERVIEW 



Acute mental health and substance abuse services are excluded from the District's mandatory health mainte- 
nance organization (HMO) program and provided on a fee- for- service (FFS) basis. 

For specialty mental health and substance abuse services, the District is operating a managed care waiver 
that fully integrates physical health, mental health, and substance abuse services for persons age 2 1 and under 
who receive Supplemental Security Income (SSI) benefits. 



Managed Care Programs for Behavioral Health Services 








r Medicaid Waivers 










Secxion 1115- HeaM) Services for Children with Special Needs (HSCSN) - gene 
Physical, mental health, and substance abuse services are provided for child 
disabilities and chronic illnesses. 


ral health - integrated: 
ren and adolescents with 


Medicaid Voluntary 










Not applicable. 










Other Managed Care Programs 










Not applicable. 

i 












Geographic Location 

Section ms - HSCSN: District- wide. 

Status of Programs 

Section iH5 - HSCSN: Submitted March 1994,- 
approved October 13, 1995,- implemented 
December 15, 1995. 

Medicaid Substance Abuse Services 
Remaining Fee-For^Service 

The District does not have a defined set of sub- 
stance abuse services,- however, all medically neces- 
sary services are covered when accessed through a 
clinic, hospital, or physician. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

The District does not have a defined set of mental 
health services,- however, all medically necessary 



services are covered when accessed through a clin- 
ic, hospital, or physician. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section ms - HSCSN: The plan for children with 
special needs provides the following substance 
abuse services: inpatient service (inpatient sub- 
stance abuse services to stabilize acute substance 
abuse conditions),- outpatient services. 

Medicaid Mental Health Services in 
Managed Care Plan 



Section iHS - HSCSN: The plan for children with 
special needs provides the following mental health 
services: inpatient,- outpatient (e.g., clinic services, 
hospital outpatient department),- mental health 
rehabilitation, prescription drugs, Institution for 
Mental Diseases services for individuals under 
age 22. 



July 31, 1998 



85 



Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section iiis - HSCSN: Early and periodic screening, 
diagnosis and treatment (EPSDT) services for chil- 
dren under age 21,- preventive diagnostic and 
screening services. 

Populations Covered Under Managed 
Behavioral Health 

Section ms - HSCSN: Children voluntary: SSI. 

State Managed Care Program 
Administration 

Section iii5 - HSCSN: The District's Medicaid 
agency contracts with HSCSN, a private, not-for- 
profit managed care entity that is responsible for 
developing a provider network that provides the 
complete range of Medicaid services. HSCSN con- 
tracts with any willing provider. 

Financing of Plans 

Section ms - HSCSN: The program is financed by 
Medicaid dollars. The District's Medicaid agency 
makes capitation payments to HSCSN, which is at 
partial risk. The Medicaid agency requires HSCSN 
to spend 85 percent of funds on claims or it will take 
back the difference. The capitation rate is based on 
historical usage. Providers are paid on an FFS basis. 

Coordination Betv/een Primary and 
Behavioral Health Care 

Section iiis - HSCSN: HSCSN provides both physi- 
cal and mental health services. 



Future Plans 



Section iH5 - HSCSN: This program ends in 
December 1998. There are no plans yet as to next 
steps. 

State Agency Administration 

The Medicaid authority, the Medical Assistance 
Administration, and the substance abuse authority, 
the Addictions Prevention and Recovery 
Administration, are under the Department of 
Health. The mental health authority is the 
Commission on Mental Health Services, under the 
auspices of the Mental Health Receiver. 

Welfare Reform 

The District's Temporary Assistance for Needy 
Families (TANF) plan became effective December 3, 
1996. The plan stipulates denying TANF benefits to 
drug felons. The District does not require drug test- 
ing of recipients. 

County 

Not applicable. 

Evaluation Findings 

Evaluations are in process. 

Other Quantitative Data 

Not applicable. 



Consumer-Family Involvement 

Section iiis - HSCSN: None. 



86 



{SAMHSA} Managed Care Tracking System 



FLORI DA 



OVERVIEW 

Medicaid managed care is delivered through three vehicles in Florida: A statewide primary care case 
management plan, a statewide voluntary health maintenance organization (HMO) program, and a 
mental health stand-alone in the Tampa Bay area. Statewide, all recipients may choose between the 
HMO program and the primary care case management (PCCM) plan for physical health services. 
Except in the Tampa Bay area, community mental health and substance abuse services are excluded 
from these plans and provided on a fee-for-service FFS basis. In Tampa Bay, however, recipients who 
choose the PCCM plan are referred to a mental health stand-alone program, known as the Florida 
Prepaid Mental Health Plan (PMHP). Recipients who choose the HMO receive all of their services, 
including mental health and substance abuse treatment, from the HMO. However, HMOs in the 
Tampa Bay area subcontract with the carve-out subcontracted providers. 

Three other managed care programs are operating in the State: A child welfare initiative that 
includes behavioral health services,- a capitation program for all social services including substance 
abuse, and a Medicaid utilization management program for all inpatient psychiatric visits. 



Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 

Section 1915(b) - Florida PMHP - mental health stand-alone: Provides mental health services only to 

Medipass enrollees in the five-county Tampa Bay area on a mandatory basis. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

Department of Children and Families - child welfare program - integrated: District offices of the 
Department of Children and Families, which administer State general fund programs for behavioral 
health, have contracted with Medicaid to coordinate diversion and aftercare efforts by community- 
based behavioral health care providers. Medicaid recipients who present at inpatient hospitals for psy- 
chiatric care will be served. Additionally, the district offices will oversee case planning for "high use" 
Medicaid recipients. 

Capitation plan - substance abuse stand-alone: Starting in July 1995, Florida began to capitate its fund- 
ing to social service district offices for all social services, including substance abuse. 

B)ehaV\oral Health Care Utilization Management Service - Medicaid program - behavioral health stand- 
alone: reviews inpatient psychiatric services for Medicaid recipients who remain in the FFS system. 



Geographic Location 



Status of Programs 




Section i9i5[b] - PMHP: Five counties (Hardee, 
Highland, Hillsborough, Manatee, and Polk). 

Department oj Children and Families: Unknown. 

Capitation plan: Statewide. 

Behavioral Health Care Utilization Management Service: 
Statewide. 



Section i9i5[b] - PMHP: Original submission date: 
unknown. Original approval date: unknown. 
Implemented March 1, 1996. Renewal application 
submitted January 14, 1998. Extension granted 
until August 27, 1998. 

Department oJ Children and Families Llnl<nown 



July 31, 1998 



87 



Capitation plan: Implemented July 1995. 
Behavioral Health Care Utilization Management Service-. 
Implemented January 1997. 

Medicaid Substance Abuse Services 
Remaining Fee-For^Servlce 

Ambulatory detoxification, outpatient, opiate treat- 
ment programs, inpatient. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 



Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Inpatient, outpatient; mental health rehabilitation 
(e.g., community-based facility care, targeted case 
management); Institution for Mental Diseases 
(IMD) services for individuals age 65 and over. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section I9i5{h) -PMHP. Not applicable. 

Behavioral Health Care Utilization Management Service: 
Not applicable. 

Medicaid Mental Health Services in 
Managed Care Plan 

Section igislh) -PMHP: Inpatient; outpatient; mental 
health rehabilitation (e.g., targeted case manage- 
ment); mental health support (e.g., community 
mental health). Statewide, HMOs cover inpatient 
and outpatient hospital mental health services and 
psychiatrist services. In the Tampa Bay area, HMOs 
also cover community mental health and mental 
health targeted case management. The PMHP is 
allowed to use IMDs as a downward substitution for 
inpatient treatment when it is determined to be 
appropriate and medically necessary for recipients 
of all ages. 

Behavioral Health Care Utilization Management Service: 
Inpatient. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Department of Children and Families: Unknown. 
Capitation plan: Unknown. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 



Department oj Children and Families: Unknown. 
Capitation plan: Not applicable. 



Section i9i5[h)- PA4HP. Early and periodic screening, 
diagnosis, and treatment (EPSDT). HMOs are also 
required to provide six quality and benefit enhance- 
ments regarding substance abuse and child wellness. 

Department of Children and Families: Unknown. 

Capitation plan: Unknown. 

Behavioral Health Care Utilization Management Service: 
Not applicable. 

Populations Covered Under Managed 
Behavioral Health 

Section i9i5(b') -PMHP: Children and adults manda- 
tory: Aid to Families with Dependent Children 
(AFDC), Supplemental Security Income (SSI), 
Seventh Omnibus Budget Reconciliation Act 
(SOBRA). 

Department of Children and Families: Children volun- 
tary: AFDC, SSI, and SOBRA. 

Capitation plan: Unknown. 

Behavioral Health Care Utilization Management Service: 
Not applicable. 

State Managed Care Program 
Administration 

Section 1 9 i 5[h] - PMHP: The Agency for Health Care 
Administration (Medicaid) contracts with Florida 
Health Partnership (FHP). FHP is a partnership 
between five community mental health centers that 
incorporated as a nonprofit organization named 
Florida Behavioral Health, Inc., and a private man- 
aged care organization. The managed care organi- 
zation serves as the managing partner responsible 
for administration, utilization management, quality 
improvement, medical economics, network man- 
agement, and management information systems. 
Florida Behavioral Health, Inc., is responsible for 
the delivery of mental health services. FHP has not 
replaced any function traditionally performed by 
Medicaid or the Department of Children and 
Families. 

Department of Children and Families: The Depart- 
ment of Children and Families has lead responsibil- 
ity for this program. 

Capitation plan: Unknown. 

Behavioral Health Care Utilization Management Service: 
Medicaid contracts with a private utilization review 
firm to provide some administrative functions. 



88 



{SAMHSA} Managed Care Tracking System 



Financing of Plans 



Section i9i5 - PMHP: The source of funds is 
Medicaid dollars. FHP assumes full risk for this pro- 
gram. Medicaid resources previously spent on men- 
tal health services in the demonstration area were 
capped and contracted to FHP to manage. The 
State developed capitation rates using a federally 
approved methodology. The request for proposals 
(RFP) included rates that were at the upper payment 
limit of Medicaid's projected FFS expenditures for 
similar services to any actuarially equivalent popula- 
tion of recipients. The RFP required responding 
providers to specify in their rate proposals the per- 
centage of the upper payment level rates that would 
be acceptable. Rate proposals were required to 
reflect bids between 92 and 100 percent of the 
upper payment level. The State stipulated that the 
capitation rate methodology would be as described 
in the RFP, but the actual capitation rates of pay- 
ment would be developed for the applicable con- 
tract period. The winning proposal bid 92 percent. 
In the first 3 years of the waiver, a capitation rate of 
92 percent has been paid. 

Department oj Children and Families: The source of 
funding for this program is State general funds. 

Capitation plan: Funds for this program come 
from the Medicaid agency and State funds. The 
local districts are responsible for allocating these 
resources in a fashion consistent with their local 
objectives, as well as cutting services to meet the 
budget targets established by the State. Districts 
may shift funds from one district to another. 

Behavioral Health Care Utilization Management Service: 
The program is funded by Medicaid funds. The uti- 
lization review firm is paid a flat fee for services. 

Coordination Between Primary and 
Behavioral Health Care 

Section 49 i 5(b) - Florida PMHP: In the Tampa Bay 
area, the Medicaid agency provides information to 
Medipass primary care physicians regarding their 
enrollees' PMHP. This facilitates primary care 
physician referrals to appropriate mental health 
providers. The Medicaid agency is providing train- 
ing to area Medicaid providers about the PMHP, 
thus alerting physicians, hospitals, and other 
providers about referral to PMHP. 

Department oj Children and Families: Unknown. 



Capitation plan: Not applicable. 
Behavioral Health Care Utilization Management Service: 
Not applicable. 

Consumer-Family Involvement 

Florida is among the first states to implement an 
ombudsman program for managed care consumers. 
The ombudsman, who works for all managed care 
organizations including Medicaid, will be responsi- 
ble for resolving disputes between health plans and 
consumers. The program was initiated by State leg- 
islation and puts the power of a state regulatory 
agency behind the program, which is expected to 
make it even more effective. 

Section i9i5(h] - PMHP: The PMHP and the 
HMOs in the pilot area are members of a Managed 
Behavioral Healthcare Advisory Group, that con- 
venes quarterly to report on advocacy and pro- 
grammatic concerns. The membership is composed 
of representatives from the Agency for Healthcare 
Administration, program supervisors from the local 
Alcohol, Drug Abuse, and Mental Health Program 
Offices, the local mental health and substance abuse 
providers, local consumer advocacy groups, and 
consumers and family members of consumers. The 
Advisory Group is responsible for providing techni- 
cal and policy advice to the Agency concerning the 
provision of services to its members. The Managed 
Behavioral Healthcare Advisory Group has con- 
sumer and family representation from all five coun- 
ties involved in this project. In addition, the agency 
conducts a Statewide Managed Care Advocacy 
Workgroup and holds monthly meetings respond- 
ing to managed care issues and reporting on upcom- 
ing initiatives. The local advisory group's function is 
to provide technical and policy advice to the 
agency regarding the plan's provision of services. 
The quarterly meetings are attended by the adviso- 
ry group members, the PMHP and HMO contract 
managers from Tallahassee and Tampa, representa- 
tives from all of the HMOs providing services in the 
area, representatives from the PMHP, community 
mental health providers, district program adminis- 
trators from the Department of Children and 
Families, and an administrator from the State hospi- 
tal serving that area of the State. When concerns are 
raised by this advisory group, the other individuals 
in attendance have the authority to address their 
concerns and implement recommended changes. 



July 31, 1998 



89 



Department of Children and Families: Unknown. 
Capitation plan: Unknown. 

Behavioral Health Care Utilization Management Service: 
Not applicable. 

Future Plans 



Section i9i5[h) - PMHP: At end of the 2-year pilot, 
the contract will be evaluated and substance abuse 
services may be added at that time. In addition, 
planning is under way to evaluate the PMHP pro- 
gram in one area. 

Department of Children and Families: Unknown. 

Capitation plan: Unknown. 

Behavioral Health Care Utilization Management Service: 
The utilization management service contract is a 
30-month contract with the option for two 1-year 
extensions at the end of the 30 months. 

State Agency Administration 



The Division of Medicaid and the Division of 
Health Quality Assurance are housed in the Agency 
for Health Care Administration. The mental health 
authority, the Mental Health Program Office, and 
the substance abuse authority, the Office for 
Substance Abuse Treatment, are housed within the 
Department of Children and Families. 

Welfare Reform 

Florida has adopted its Work and Gain Economic 
Self Sufficiency (WAGES) as its Temporary 
Assistance for Needy Families plan. The plan 
became effective October 1, 1996. The program 
does not deny benefits to drug felons whose crimes 
do not include drug trafficking. It does not test 
recipients for drug use. Additionally, the program 
provides for personal or family counseling or thera- 
py, including substance abuse, if necessary for a 
WAGES participant to secure or retain a job. 



County 

Duval County: A project in Duval County covers 
behavioral health for child welfare children. 
Funding for the program is provided by Child 
Welfare, Medicaid, mental health, juvenile justice, 
and substance abuse. Both a Medicaid waiver and 
Title IV-E waiver are pending. The State Alcohol, 
Drug Abuse and Mental Health Office manages 
preauthorization for care, tracks data, and creates 
provider networks. There are no plans to share 
financial risk with providers. 

Evaluation Findings 



The Agency for Health Care Administration has 
contracted with the Florida Mental Health Institute 
(FMHl) at the University of South Florida to evalu- 
ate the State's current mental health system. The 
contract is in effect from July 15, 1996, through 
March 1, 1999. FMHI will be comparing cost, utili- 
zation, quality, and access for three systems of care: 
FFS, managed care (carve-in/HMOs), and the PMHP 
carve-out. The final product, due March 1, 1999, 
will be an evaluation of the systems with recom- 
mendations based on issues identified in the study. 

Other Quantitative Data 

Section I9i5(h] - PMHP: During calendar year 1997, 
the average enrollment for the PMHP was approxi- 
mately 58,754 members. The service penetration 
rate for 1 997 was 1 1 .2 percent, or 6,583 unduplicat- 
ed members. The average length of stay for inpa- 
tient treatment was 6.6 days. 

In the first 3 years of the waiver a capitation rate 
of 92 percent has been paid, which should provide 
a savings of 8 percent of FFS expenditures annually. 
The State is currently working on cost-effectiveness 
data for waiver renewal and does not yet have actu- 
al cost savings data available to report. 



90 



{SAMHSA} Managed Care Tracking System 



GEORGIA 



OVERVIEW 

Georgia Medicaid is not actively pursuing managed behavioral health care, behavioral health services 
are currently in the fee-for-service system. In September 1995, Georgia submitted a Section 1115 
v/aiver to the Health Care Financing Administration, known as the Georgia Behavioral Health Plan. 
The State withdrew its application. 

On the local level, however, a public nonprofit community mental health, mental retardation, 
and substance abuse provider, community service board (CSB), in south Georgia has contracted with 
a managed behavioral health company for administrative services only (ASO). Services covered with- 
in this effort include 24-hour telephone triage, prospective service authorization, and network man- 
agement services. Ten counties are covered for services under this contract. 

Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 
Not applicable. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

CSB/ASO program - behavioral health stand-alone: Local mental health and substance abuse program 

with ASO arrangement. 



Geographic Location 



CSBIASO program. 10 counties: Lowndes, Turner, 
Ben Hill, Irwin, Tift, Berrien, Cook, Brooks, Lanier, 
and Echols. These are the only counties included in 
the CSB/ASO contract. 

Status of Programs 

CSEI ASO program. Implemented November 1997. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Detoxification,- opiate treatment (e.g., methadone 
maintenance); outpatient (e.g., diagnostic assess- 
ment, nursing assessment, health referrals, counsel- 
ing),- crisis (e.g., emergency services, crisis interven- 
tion or crisis stabilization),- inpatient (e.g., acute 
care). 



Medicaid Mental Health Services 
Remaining Fee-For-Service 

Inpatient (e.g., acute care),- outpatient (e.g., clinic 
services); mental health rehabilitation (e.g., target- 
ed mental health, mental retardation, and substance 
abuse case management); prescription dmgS; psy- 
chological services (for children only); therapeutic 
residential intervention services (for children only); 
physician/psychiatrist services. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 




July 31, 1998 



91 



Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

CSB/ASO program: Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

CSB/ASO program: Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



CSB/ASO program: Not applicable. 

Populations Covered Under Managed 
Behavioral Health 

CSB/ASO program: Individuals served under this con- 
tract are those with mental illness, mental retarda- 
tion, or substance abuse who are supported by State 
allocations. 

State Managed Care Program 
Administration 



CSB/ASO program: One community service board 
contracts with a managed behavioral health compa- 
ny to provide 24-hour telephone triage, prospective 
service authorization, and network management 
services. 

Financing of Plans 

CSB/ASO program: State mental health, mental retar- 
dation, and substance abuse allocations pay for the 
ASO contract. 

Coordination Between Primary and 
Behavioral Health Care 



CSB/ASO program: Not applicable. 

Consumer-Family Involvement 

CSB/ASO program: Not applicable. 

Future Plans 

* New Program Under Development: The Depart- 
ments of Medical Assistance, Human Resources, 
Education, and Juvenile Justice are participating in a 
study of children's behavioral health needs. As part 
of this study, they are examining successful man- 



aged behavioral health services for children in other 
States. 

State Agency Administration 

Mental health and substance abuse are housed 
together in the Division of Mental Health, Mental 
Retardation and Substance Abuse (DMHMRSA), 
under the Department of Human Services. The 
Georgia Department of Medical Assistance is 
responsible for Medicaid programs. 

Welfare Reform 

Georgia's Temporary Assistance for Needy Families 
(TANF) plan, which became effective in January 
1997, stipulates denying TANF benefits to drug 
felons. The plan does not test its recipients for drug 
use. 

Georgia submitted a Welfare-to-Work plan in 
December 1997. The administrative agencies for 
the plan are Department of Labor, Department of 
Human Resources, and Department of Technical 
and Adult Education. Substance abuse treatment is 
funded under this plan and provided through the 
State DMHMRSA and its contractors. 

MHMRSA is participating in joint initiatives 
with the Division of Family and Children Services 
(DFCS) to address needs of pregnant or parenting 
women and their children. The efforts include plan- 
ning to use funds available under the welfare reform 
initiative for treatment services to DFCS recipients. 
Both agencies are increasing collaboration at the 
local level to engage families in treatment and pre- 
vent removal of children from parental custody 
because of substance abuse problems. Currently, 
training is under way for MHMRSA providers 
statewide on substance abuse services to TANF con- 
sumers. Full implementation of treatment services is 
to begin statewide by June 15, 1998. 



County 

Not applicable. 



Evaluation Findings 

Not applicable. 

Other Quantitative Data 

None. 



92 



{SAMHSA} Managed Care Tracking System 



H AWAI I 



OVERVIEW 

Hawaii has adopted a statewide managed care strategy that incorporates multiple funding streams. 
The State's ultimate goal is to establish a single managed health care system for the State's indigent 
and uninsured residents. Under its Section 1115 waiver, QUEST, general physical health managed 
care plans provide mental health and substance abuse services to non-SED (severe emotional distur- 
bance) and non-SMI (serious mental illness) individuals. Mental health and substance abuse services 
for SMI adults and SED children are managed under a separate carve-out arrangement called 
Community Care Services (CCS). Adults with SMI and children with SED receive their physical 
health care through the same prepaid health plans that serve the general QUEST population. 



Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 
I Section 1115- Hawaii QUEST - carve-out For SMI and SED. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

Section 1115- Hawaii QUEST - carve-out This program serves the non-Medicaid or General 

Assistance population as well. 

Children's Demonstration - behavioral health stand-alone:The Hawaii Child and Adolescent Mental 
Health Division has implemented a demonstration project on the island of Hawaii in which a single 
care management company provides behavioral health services to SED children. 



Geographic Location 



Section iiis - Hawaii QUEST Statewide. 
Children's Demonstration: Island of Hawaii. 

Status of Programs 

Section las - Hawaii QUEST. Approved July 16, 
1993; implemented August 1, 1994,- carve-out for 
SMI adults began November 1, 1994,- carve-out for 
SED children began September 1, 1997. 
Children's Demonstration-. Implemented. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Detoxification,- outpatient (e.g., intensive outpa- 
tient care),- inpatient (e.g., hospitalization),- rehabil- 
itation (e.g., partial hospitalization, day treatment), 
opiate treatment. 



Medicaid Mental Health Services 
Remaining Fee-For^Service 

Inpatient; outpatient (e.g., clinic services, nonphysi- 
cian providers); support (e.g., targeted case man- 
agement); pharmacy. 

Medicaid Substance Abuse Services in 
Managed Care Plan 



Section ms - Hawaii QUEST Substance abuse ser- 
vices offered under the general physical health 
QUEST plans are inpatient (limited to 30 days per 
benefit year); detoxification (considered part of 
inpatient benefit); outpatient (limited to 24 hours of 
visits per benefit year; includes screening for sub- 
stance abuse problems); opiate treatment; rehabili- 
tation (e.g., individual and group therapy, day treat- 
ment, and hospitalization). 




July 31, 1998 



93 



Carve-out: 

For SMI adults: Inpatient; detoxification (e.g., 
social and medical),- rehabilitation (e.g., individual 
and group counseling, day treatment and intensive 
day treatment, prevocational services, social/recre- 
ational services); transportation; opiate treatment. 

For SED children: Outpatient (e.g., individual 
and group therapy, group therapy, medication man- 
agement). 

Medicaid Mental Health Services in 
Managed Care Plan 

Section iH5 - Hawaii QUEST Mental health services 
offered under the general physical health QUEST 
plans are inpatient (limited to 30 days per benefit 
year); outpatient (limited to 24 hours of visits per 
benefit year; includes psychological testing, partial 
hospitalization, physician services); crisis (i.e, 
ambulatory services); prescription drugs (includes 
medication management, patient counseling); and 
mental health support (e.g., therapeutic services 
that include individual and group therapy). 

Carve-out: 

For SMI adults: Inpatient; crisis; case manage- 
ment; behavioral health treatments (e.g., screening, 
assessment services, medication evaluation, indi- 
vidual and group counseling, homebound services, 
continuous treatment teams); day treatment and 
intensive day treatment; prevocational services; 
social/recreational services recipient education; 
transportation services; community education). 

For SED children: Outpatient services (e.g., 
individual and group therapy, psychiatric diagnos- 
tic evaluation, individual psychotherapy, group 
therapy, medication management); inpatient psy- 
chiatric facility services (includes 24-hour acute 
care); targeted case management services. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Section ins - Hawaii QUEST: Substance abuse ser- 
vices offered under the general physical health 
QUEST plans are inpatient; opiate treatment; reha- 
bilitation (e.g., individual and group therapy, day 
treatment, and hospitalization). 

Children's Demonstration: Unknown. 



Non-Medicaid Mental Health Services in 
Managed Care Plan 

Section ms - Hawaii QUEST Mental health services 
offered under the general physical health QUEST 
plans are inpatient; crisis; day treatment and hospi- 
talization; prescription drugS; physician services; 
therapeutic services (includes individual and group 
therapy). 

Children's Demonstration: Unknown. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Section Hi5 - Hawaii QUEST Provider and consumer 
education; early intervention services; early and 
periodic screening, diagnosis, and treatment 
(EPSDT). 

Children's Demonstration: Unknown. 

Populations Covered Under Managed 
Behavioral Health 

Section ms - Hawaii QUEST Adults and children 
mandatory: Aid to Families with Dependent 
Children/Temporary Assistance for Needy Families 
(AFDCAFANF), former State Health Insurance 
Program (SHIP) members (persons who may not 
meet categorical requirements but meet functional 
requirements — income below 100 percent FPL); 
U.S. citizen not eligible for insurance through 
employer, etc.); Supplemental Security Income, 
dually eligible (Medicare/Medicaid); uninsured 
(expanded group up to 100 percent FPL meeting 
asset limits); and underinsured. 

Children's Demonstration: SED children who are 
not covered under Hawaii's QUEST program. 

State Managed Care Program 
Administration 



Section iH5 - Hawaii QUEST Hawaii's Department 
of Human Services' Med-QUEST Division 
(Medicaid) contracts with six QUEST health plans 
for general physical health, including a basic bene- 
fit package for mental health and substance abuse. 
The six plans include two staff models and four pre- 
ferred provider organization models. All plans must 
provide services in a managed care environment 
through a network. 

The basic functions or responsibilities of the 
Medicaid agency include 



94 



{SAMHSA} Managed Care Tracking System 



Developing and defining the medical, dental, 

and behavioral health benefits to be provided 

by the capitated managed care plans,- 

Developing the rules, policies, regulations, and 

procedures to be followed,- 

Negotiating and contracting with selected 

plans,- 

Determining the eligibility of recipients,- 

Enrolling the recipients into participating plans,- 

Monitoring the quality assurance programs of 

plans and providers,- 

Reviewing use of services provided by the 

plans; 

Handling unresolved recipient grievances with 

the plans and providers,- 

Billing and collecting recipient premium share,- 

Monitoring the financial status of QUEST and 

the Aged, Blind, Disabled (ABD) programs,- 

Analyzing the effectiveness of QUEST and the 

ABD programs in meeting their objectives,- and 

Managing the QUEST information System. 

For the behavioral health care carve-out CCS, 
Medicaid contracts with Hawaii Medical Service 
Association (HMSA) to deliver specialized mental 
health and substance abuse services to both SMI 
adults and SED children. HMSA is also responsible 
for some physical health services under Hawaii 
QUEST 

Responsibilities of HMSA include credential- 
ing, provider servicing, care coordination and case 
management, authorizing services, performing qual- 
ity assurance and utilization management, claims 
processing, and contracting with behavioral health 
care providers. HMSA subcontracts with Hawaii 
Biodyne and Kapiolani Medical Specialists. Hawaii 
Biodyne, a for-profit entity under a private, for-prof- 
it behavioral health managed care organization, 
manages the clinical services. Kapiolani Medical 
Specialists follows Hawaii Biodyne's clinical proce- 
dures and criteria to provide utilization manage- 
ment to SED children. Under contract with HMSA, 
CCS has a comprehensive statewide network of 
public agencies (e.g., community mental health 
centers); private entities (e.g., mental health clinics, 
substance abuse agencies, residential programs for 
mental health and substance abuse),- and psychia- 
trists and psychologists. The provider panel is open. 



Children's Demonstration. Medicaid contracts with 
a single care management company to administer 
this program. 

Financing of Plans 



Section ms - Hawaii QUEST Under QUEST, Hawaii 
combines into one program three funding sources 
for health insurance: Medicaid's AFDC-related eligi- 
bles; the State funded general assistance program,- 
and SHIR Funds are blended at the State level in the 
Medicaid agency's services/benefits budget. The 
state pays a capitation rate for each QUEST recipi- 
ent, regardless of the population group. 

The six physical health care plans are paid a 
capitation rate negotiated between the health plans 
and Medicaid. Most recently, rates were competi- 
tively bid. HMSA is at full risk and paid a per-mem- 
ber per-month rate for behavioral health services. 
Under the carve-out, providers are paid on a fee-for- 
service or monthly case rate basis (used primarily for 
case management services). Savings are reinvested 
in the development of new services. There is a 3 
percent limit on profits. 

Children's Demonstration: Unknown. 

Coordination Between Prinnary and 
Behavioral Health Care 

Section iiis - Hawaii QUEST All participants receive 
health care through prepaid managed care plans, 
through which a package of inpatient and outpa- 
tient mental health and substance abuse services is 
available. CCS recipients who meet the criteria for 
SMI or SED are enrolled in the behavioral health 
managed care plan and continue to receive their 
medical and dental care services through the man- 
aged care plans. 

Children's Demonstration: Under this demonstra- 
tion, copies of all authorizations are sent to primary 
care providers (PCPs). Because CCS is an assertive 
care coordination provider, telephonic links are 
made with PCPs as necessary. 

Consumer^Family involvement 

Section iH5 - Hawaii QUEST The Behavioral Health 
Technical Committee, composed of consumers, 
advocacy organizations, and providers of the mul- 
tiple subpopulations within the ABD population, 
met over a 2- to 6-month period to provide input 



July 31, 1998 



95 



about the specific behavioral health needs of per- 
sons with mental illness, those with substance 
abuse problems, the aged, persons with develop- 
mental disabilities/mental retardation, the home- 
less, persons with HIV/AIDS, children with behav- 
ioral health problems, and persons with multiple 
diagnoses. 

Children's Demonstration: Unknown. 

Future Plans 



Section iH5 - Hawaii QUEST: Under Phase II, there 
are plans to expand the populations covered to 
include the ABD population. 

Children's Demonstration: Unknown. 

State Agency Administration 

The Department of Human Services houses the 
Med-QUEST Division (Medicaid). The Depart- 
ment of Health houses the Mental Health and 
Substance Abuse agencies,- within each agency 
resides the Adult and Children and Adolescent 
Mental Health Division and the Alcohol and Drug 
Abuse Division, respectively. 

Welfare Reform 

Hawaii's Welfare to Work (WtW) plan was submit- 
ted on January 1, 1998, and approved by the U.S. 
Department of Labor on March 2, 1998. Hawaii's 
Department of Labor and Industrial Relations will be 
administering the grant. One hundred percent of 
State funds will be used to match Federal dollars. 
The intended use of 1 5 percent of the State project 
funds will be to support innovative approaches to 
serve special target groups such as substance abusers. 
Hawaii requested a waiver for the Department 
of Labor and Industrial Relations to be the alternate 
agency to administer the WtW grant funds in three 
of the four service delivery areas. The substate allo- 
cation formula for 85 percent of the funds will be 
divided in the following ways; 50 percent poor,- 25 
percent TANF,- 25 percent unemployed. Coordi- 
nation mechanisms linking local WtW entities and 
local TANF agencies will be defined by private 
industry councils in local plans. Performance goals 
and outcome measures include the following: 



• Number of individuals receiving post employ- 
ment services,- 

• Percentage of those leaving TANF rolls who are 
employed during the quarter they leave,- 

• Percentage of those leaving TANF rolls who 
earn at least the minimum wage 40 hours/week. 

Hawaii's welfare reform program currently does 
not mandate drug testing for all TANF recipients nor 
does it deny benefits to welfare recipients convicted 
of drug felonies. 



County 

Not applicable. 

Evaluation Findings 



Section ms - Hawaii QUEST: The behavioral health 
carve-out (CCS) has reported the following findings: 

• 82.6 percent of CCS members rated care coor- 
dination services as excellent or good,- and 

• Since the inception of the program (1994), 
HMSA has committed $1.8 million to commu- 
nity infrastructure development to help address 
shortages of community-based treatment and 
support. 

CCS has a Quality Improvement Committee 
composed of community representatives who over- 
see continuous quality improvement. To ensure 
members receive excellent care, the Committee ad- 
dresses member needs,- ensures that services are 
being fully utilized,- improves the services provided,- 
and incorporates community feedback into service 
delivery. 

Pre-CCS (early 1994) utilization trends were 
compared with the trends for each year thereafter 
(1995, 1996, 1997). Quality-of-life measures are 
being conducted under a SAMHSA grant, in which 
the SMI population under managed care is being 
compared to the SMI population whose care is not 
managed. 

Level of functioning and substance use data are 
currently being collected for an analysis, as of 
January 1, 1998. 



Other Quantitative Data 



Placements in unsubsidized employment. 
Retention and earnings in unsubsidized employ- 
ment after 1 3 weeks and up to 1 year,- 



Section ms - Hawaii QUEST Covers 130,000 lives, 
which is 80 percent of the Medicaid population. 
The other 20 percent of Medicaid eligibles (32,000) 
remain in the fee-for-service system. 



96 



{SAMHSA} Managed Care Tracking System 



IDAHO 



OVERVIEW 



Idaho's substance abuse authority contracts with a private behavioral health firm for all gatekeeping 
and support services. The State has recently released a new request for proposals (RPP) for the man- 
agement and delivery of substance abuse treatment. 

Managed Care Programs for Behavioral Health Services 

Medicaid Waivers I 

Not applicable. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

Idaho Substance Abuse Services - substance abuse stand-alone: Currently, a managed behavioral health 

care firm provides support and gatekeeping services on a managed fee-for-service basis. 



Geographic Location 



Idaho Substance Abuse Services: Statewide. 

Status of Programs 

Idaho Substance Abuse Services-. Currently operating. 



Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

The following substance abuse services are covered 
under Idaho's Medicaid program: inpatient,- outpa- 
tient (e.g., day care, aftercare), detoxification. 



Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Idaho Substance Abuse Services-. Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Idaho Substance Abuse Services: Not applicable. 



Medicaid Mental Health Services 
Remaining Fee-For-Service 

The following mental health services are covered 
under Idaho's Medicaid program: inpatient,- outpa- 
tient,- mental health rehabilitation (e.g., targeted 
case management). 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 



Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Idaho Substance Abuse Services: Not applicable. 

Populations Covered Under Managed 
Behavioral Health 



Idaho Substance Abuse Services: Children and adults 
mandatory: uninsured. 




July 31, 1998 



97 



State Managed Care Program 
Administration 

Idaho Substance Abuse Services: The Department of 
Health and Welfare contracts with a private man- 
aged behavioral health care firm to provide support 
and gatekeeping services for substance abuse treat- 
ment in each of the State's three Integrated Service 
Areas. The firm is not at risk and receives a set fee 
for services rendered. 

Financing of Plans 



Idaho Substance Abuse Services: The behavioral health 
care firm receives a set fee for services rendered. 

Coordination Between Primary and 
Behavioral Health Care 



Idaho Substance Abuse Services: Not applicable. 

Consumer^Famiiy Involvement 

Idaho Substance Abuse Services: Unknown. 

Future Plans 

* New Program Under Development: The State has 
released an RFP to contract out substance abuse ser- 
vices, including prevention services, day care, after- 
care, outpatient, inpatient, and detoxification. The 



program will cover uninsured children and adults 
who will be required to pay for services on a sliding 
scale. Firms responding to the RFP may or may not 
subcontract out the services to providers. 

State Agency Administration 



The Medicaid authority, the Division of Medicaid, 
is within the Department of Health and Welfare, as 
is the mental health and substance abuse authority, 
the Bureau of Mental Health and Substance Abuse 
Services. 

Welfare Reform 

Idaho's statewide Temporary Assistance for Needy 
Families program became effective July 1, 1997. 
The program denies benefits to drug felons but does 
not test recipients for drug use. 

County 

Not applicable. 

Evaluation Findings 

Not applicable. 

Other Quantitative Data 

Not applicable. 



98 



{SAMHSA} Managed Care Tracking System 



ILLI NOIS 



OVERVIEW 

Illinois has no immediate intention of developing a managed care plan specifically for publicly 
funded behavioral health care. However, the State operates a voluntary managed care program for 
physical health that includes all mental health and substance abuse services covered by the 
Medicaid program. The voluntary program is called Responsible Choice and requires all clients to 
make a choice between the fee-for-service (FFS) program and the managed care program. Services 
under the managed care program are delivered by health maintenance organizations (HMOs) and 
prepaid health plans (PHPs). PHPs are HMO-like entities that are non-risk bearing entities regu- 
lated by the Illinois Department of Public Aid (IDPA). Both medical assistance grant (MAG) cases 
and medical assistance no grant (MANG) eligibles are allowed to enroll in managed care. 

Managed Care Programs for Behavioral Health Services 

11 Medicaid Waivers 

Illinois was granted a Section I 1 15 waiver in July 1996. At the current time, the State has chosen not 
to implement the waiver program. 

II Medicaid Voluntary 

Responsible Choice - general health - integrated:Vbluntary program that includes all menta! health and 
substance abuse services covered by the Medicaid program. 

I Other Managed Care Programs 
Not applicable. 



Geographic Location 



Responsible Choice: Currently implemented in Cook 
and St. Clair Counties. Contracts are in place under 
the voluntary program to cover 67 counties. 

Status of Programs 

Responsible Choice: Implemented in January 1975 in 
two counties. Contracts expanded to cover 45 
counties in December 1997. Sixty-seven counties 
covered by contract in May 1998. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 



Outpatient; acute detoxification,- residential sub- 
stance abuse treatment programs. 



Medicaid Mental Health Services 
Remaining Fee-For-Service 

Inpatient; Institution for Mental Diseases (IMD) 
services for individuals under age 22 and over age 
65i outpatient; mental health rehabilitation. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Responsible Choice: Crisis (e.g., emergency care ser- 
vices, crisis assessment and intervention); outpa- 
tient (e.g., psychiatric evaluation); detoxification 
services. 

Medicaid Mental Health Services in 
Managed Care Plan 






Responsible Choice: Inpatient; IMD services for indi- 
viduals under age 22 and over age 65; outpatient; 
mental health rehabilitation 




July 31, 1998 



99 



Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Responsible Choice: No preventive behavioral health 
services are offered. 

Populations Covered Under Managed 
Behavioral Health 



Responsible Choice: Children and adults voluntary: 
Temporary Assistance for Needy Families (TANF) 
MAG and MANG recipients. Children voluntary: 
general assistance. 

State Managed Care Program 
Administration 



Responsible Choice: IDPA currently contracts with ten 
HMOs and six PHPs. All Medicaid covered behav- 
ioral health care services must be provided by the 
managed care entities. 

Performance of administrative functions varies 
from HMO to HMO. Some HMOs contract out 
for these services while others do not. 

Financing of Plans 



Responsible Choice: The voluntary program is financed 
with Medicaid funds. The managed care entities are 
paid a capitated rate. The payment rate was deter- 
mined by pulling FFS claim information for a spe- 
cific fiscal year and dividing by member months for 
the same period. The resulting rate was inflated to 
the contract rate year with a 5 percent reduction 
applied to determine the capitation rate. On aver- 
age in Cook. County, the Aid to Families with 
Dependent Children (AFDC) MAG rate is $103.00 
and the AFDC MANG rate is $173.00. On average, 
the statewide rate for AFDC MAG is $103.00 and 
the AFDC MANG rate is $167.00. Mental health 
and substance abuse payments are included in the 
capitation rate. 



IDPAs contracted HMOs are at full risk while 
the PHPs are non-risk-bearing entities. PHPs are 
paid a capitation rate but revenues and expenses are 
periodically reconciled to the FFS equivalents so as 
to eliminate risk. 

Coordination Between Primary and 
Behavioral Health Care 

Responsible Choice: Meetings are held regularly with 
representatives of community behavioral health 
providers, the managed care plans and their behav- 
ioral health subcontractors, IDPA, and Offices of 
Mental Health and Alcohol and Substance Abuse 
within the Department of Human Services (DHS). 
These meetings focus on an array of issues pertain- 
ing to behavioral health care, including coordina- 
tion of care between the plans, the behavioral 
health providers, and the primary care physicians. 

Consumer-Family Involvement 



Responsible Choice: Illinois extensively used focus 
groups of clients to obtain feedback on the effec- 
tiveness of information used to explain the volun- 
tary managed care program to clients. TTiese focus 
groups have been conducted throughout the state 
and with representative groups of the Medicaid 
population including persons with mental illness or 
receiving treatment for substance abuse. The feed- 
back has been useful in the development of client 
education materials. 

Future Plans 

Responsible Choice: Expansion of the voluntary man- 
aged care program to additional counties is a goal of 
the program. DHS is willing to expand the program 
into any county a managed care entity is able to 
serve as long as a sufficient network of providers 
exists to serve the population. 

A primary care case management (PCCM) 
option exists in the second year of the Responsible 
Choice program. At this time, no decision has 
been made whether a PCCM system will be 
implemented. 

* New Program Under Development: Services to 
Children with Serious Emotional Disorders 
Initiative: A proposal has been drafted for a 
statewide project that would provide foster care/ 



100 



{SAMHSA} Managed Care Tracking System 



kinship and residential care to children with severe 
emotional disorders in State custody. 

State Agency Administration 

The Medicaid authority is the Office of Medical 
Programs, within IDPA. The mental health authori- 
ty is the Office of Mental Health and Develop- 
mental Disabilities within DHS. The substance 
abuse authority is the Office of Alcoholism and 
Substance Abuse, within DHS. 

Welfare Reform 

The State's TANF plan went into effect July 1 , 1997. 
it denies benefits to drug felons but does not test 
recipients for drug use. 

The State submitted a Welfare-to-Work grant 
to the Department of Labor on December 1 2, 1 997. 
It was approved January 29, 1998. One hundred 
percent of matching funds are State dollars. Fifty 
percent of the substate allocation goes to poor indi- 
viduals, and fifty percent to TANF recipients. 



County 



Not applicable. 
Evaluation Findings 



IDPA is in the process of developing a request for 
proposal (RFP) from Quality Assurance Organi- 
zations (QAOs) to review access and quality of 
managed care services. The QAO RFP is expected 
to be released during the summer of 1998. 

IDPA is currently working with all of the man- 
aged care entities under contract to develop a uni- 
form satisfaction survey for clients. The survey will 
assist the Department with assessing from the 
client's perspective the quality of services provided 
by the managed care entities. 



Other Quantitative Data 

Not applicable. 



July 31, 1998 



101 



I 

I 
I 

I 
I 



I N DIANA 



OVERVIEW 

Indiana's Medicaid mandatory managed care program for low-income pregnant women and children 
and families includes behavioral health as a self-referral service. The State operates one voluntary 
Medicaid program that offers some behavioral health services. In addition, two non-Medicaid pro- 
grams are specific to behavioral health care. The Hoosier Assurance Plan is a risk-sharing managed 
care system for non-Medicaid public behavioral health care services. The Dawn Project is operated 
at the county level and financed by State and local agencies. 



Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 
Not applicable. 

Medicaid Voluntary 

Hoosier Heakhwise for Persons with Disabilities and Chronic Illness (HHPD) - general health - integrated: 

Voluntary risk-based program; no waiver required. 

Other Managed Care Programs 

Hoosier Assurance Plan - general assistance - behavioral health stand-alone: Funded by Federal block 
grants and State general fund dollars; serves people with mental illnesses, emotional disorders, and 
chemical addictions. 

The Dawn Project - behavioral health stand-alone: A pilot project run by Marion County and financed 
by blended funds from the State and local agencies. 



ssswssKSffiawasKM!!^^ 



Geographic Location 



HHPD: Marion County. 

Hoosier Assurance Plan: Statewide. 
The Dawn Project: Marion County 

Status of Programs 



HHPD: Implemented July 1997. 

Hoosier Assurance Plan: Currently being phased in. 
The Daum Project: Implemented May 1, 1997. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Inpatient service, outpatient substance abuse,- 
detoxification,- opiate treatment programs, residen- 
tial substance abuse treatment programs. 



Medicaid Mental Health Services 
Remaining Fee-For-Service 

Inpatient hospital services,- outpatient hospital ser- 
vices (including clinic services),- Institution for 
Mental Diseases (IMD) services (e.g., inpatient psy- 
chiatric specialty hospitals for individuals age 65 
and over or age 21 and under),- mental health reha- 
bilitation services (e.g., targeted case management). 

Medicaid Substance Abuse Services in 
Managed Care Plan 



HHPD: The following substance abuse services are 
covered under Indiana's Medicaid program: inpa- 
tient service,- outpatient substance abuse,- detoxifica- 
tion,- opiate treatment programs,- residential sub- 
stance abuse treatment programs. 




July 31, 1998 



103 



Medicaid Mental Health Services in 
Managed Care Plan 



HHPD: Inpatient hospital services,- outpatient hospi- 
tal services (including clinic services); IMD services 
(e.g., inpatient psychiatric specialty hospitals for 
individuals age 65 and over or age 21 and under),- 
mental health rehabilitation services (e.g., targeted 
case management). 

Non-Medicaid Substance Abuse Services 
in Managed Care Plan 



Hoosier Assurance Plan: Outpatient substance abuse 
services (e.g., individualized treatment planning to 
increase patient coping skills and symptom manage- 
ment),- crisis,- inpatient services (e.g., acute stabiliza- 
tion services); detoxification. There are 30 mental 
health plans and 29 addiction plans under the 
Hoosier Assurance Plan. The addiction plans deal 
with detoxification differently. 

The Daum Project: Substance abuse services for 
children include outpatient; rehabilitation (e.g., 
intensive case management); crisis; detoxification; 
inpatient. The program addresses the need for sub- 
stance abuse services for the parents as well. The 
Dawn Project typically does not pay for substance 
abuse services for the parents; however, they are 
referred to treatment and receive case management 
services. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 



Hoosier Assurance Plan: Mental health rehabilitation 
(e.g., individualized treatment, coping skills); crisis 
(e.g., 24-hour-a-day intervention); outpatient ser- 
vices (e.g., intensive outpatient services, counseling, 
and treatment); inpatient services. 

The Dawn Project: Mental health rehabilitation 
(e.g., intensive case management); crisis (e.g., crisis 
intervention); outpatient; inpatient; mental health 
residential; mental health support (e.g., mentoring, 
respite care, and help with basic needs to support 
families to function). 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

HHPD: Not applicable. 



Hoosier Assurance Plan: Prevention is funded by 
the Division of Mental Health (DMH) outside of 
the treatment plans. 

The Dawn Project: The target population for the 
Dawn Project is children who are at imminent risk 
of out-of-home placement because of a serious 
emotional disturbance, and thus are well beyond 
prevention. However, the goal is that as savings 
are realized from this population, the savings will 
be used to serve children whose problems are less 
serious. Funding prevention was not a goal for this 
program. 

Populations Covered Under Managed 
Behavioral Health 



HHPD: Children and adults voluntary: Sup- 
plemental Security Income (SSI). HHPD does not 
cover individuals being served by the Hoosier 
Assurance Plan. 

Hoosier Assurance Plan: Children and adults volun- 
tary: Aid to Families with Dependent Children/ 
Temporary Assistance for Needy Families (AFDC/ 
TANF), SSI, Seventh Omnibus Budget Reconcili- 
ation Act (SOBRA), uninsured, and underinsured. 
The program defines uninsured as individuals living 
at or below 200 percent of the Federal poverty 
level. 

The Dawn Project: Children voluntary: SSI. 

State Managed Care Program 
Administration 

HHPD: The Medicaid agency provides the funding 
for this program and contracts with managed care 
organizations (MCOs). 

Hoosier Assurance Plan: The DMH contracts with 
not-for-profit community mental health centers 
(CMHCs) and freestanding addiction providers. 
These nonprofit organizations behave as limited 
health maintenance organizations (HMOs) and are 
at full risk for DMH-funded services. 

The Dawn Project: The three agencies that blend 
their funding are the Marion County Office of 
Family and children; the Department of Education, 
Special Education Division; and the Family and 
Social Services Administration (FSSA) DMH. 
DMH and Special Education each have a memo- 
randum of understanding with Marion County 
through which they provide funding to Marion 



104 



{SAMHSA} Managed Care Tracking System 



County. Marion County is the entity that contracts 
with the MCO. The MCO then contracts with var- 
ious providers to provide the needed services. The 
provider network is open. Because the project has 
been in place only one year, the MCO was not real- 
ly at full risk. However, the MCO will be at risk dur- 
ing the second year and the terms for that risk are 
presently being negotiated by the payers and the 
MCO. 

Financing of Plans 

HHPD: The MCO is at full risk for all Medicaid- 
covered mental health services. 

Hoosier Assurance Plan: Financed by Federal block 
grants and State general fund dollars. Funds are allo- 
cated directly to geographic regions of the State 
based on the percentage of the at-need population 
residing in the area. Managed Care Plans are fund- 
ed by blended Federal and State dollars on a case 
rate basis. 

The Dawn Project. Funding comes from blending 
funds from the Indiana Family and Social Services 
Administration, the Department of Education, the 
Marion County Office of Family and Children, 
Marion Superior Court, and the Mental Health 
Association Marion County. The providers are 
paid by the MCO. The MCO is paid a capitated 
rate on a monthly basis for each child enrolled 
in the program that month. The rate was estab- 
lished by the Consortium for the project after 
review of available data on children who were in 
placement. 

Coordination Between Prinnary and 
Behavioral Health Care 

HHPD: The HHPD program encourages communi- 
cation between mental health providers and the 
enrollee's primary medical provider even though 
mental health services can be accessed on a self- 
referral basis. 

Hoosier Assurance Plan: Hoosier Assurance Plan 
providers receive much of their funding in fee-for- 
service medical environment and are responsible for 
coordinating care. 

The Dawn Project Each child has an annual well- 
child check and a primary care physician is identi- 
fied. For Medicaid-eligible children, early and peri- 
odic screening, diagnosis, and treatment (EPSDT) is 
available. 



Consumer-Family Involvement 

HHPD: The Family and Social Services Admini- 
stration/Office of Medicaid Policy and Planning 
spent over a year analyzing utilization, eligibility, 
and diagnosis data for the populations and con- 
sulted with more than 20 advocacy groups and 
other State agencies serving persons with 
disabilities. 

Hoosier Assurance Plan: The Indiana Family and 
Social Services Administration/DMH is advised by 
a council and five bureau committees, all of which 
include consumer representatives of the targeted 
populations. The targeted populations are adults 
with serious mental illness (SMI), children and ado- 
lescents with severe emotional disturbance (SED), 
and persons of all ages with chronic addictive disor- 
ders. The committees and the council have provid- 
ed input into the design and implementation of the 
Hoosier Assurance Plan since its inception and con- 
tinue to do so. 

The Dawn Project: Parents of children with SED 
are members of the Consortium and served on the 
task force that developed the name of the project 
and the parents' handbook. Parents also advised as 
to what type of group they wanted to form among 
themselves. Parents and sometimes older children 
are also part of the service coordination team, and 
no meetings are held unless the parents are present. 

Future Plans 

HHPD: The program may expand to include dually 
eligibles. 

Hoosier Assurance Plan: The next step is to devel- 
op risk-adjusted rates for all populations and pro- 
vide choice to persons with SMI. 

The Dawn Project: The State is evaluating how it 
could help provide the infrastructure for other 
counties to implement their version of a "Dawn- 
like" project. DMH is contracting with local pre- 
vention service coalitions. The Dawn Project is sim- 
ilar to the Hoosier Assurance Plan in that a capitat- 
ed rate is paid for an episode of services. The data 
and enrollment requirements are different, but pre- 
and post-tests are administered to measure impact. 

State Agency Administration 



The substance abuse and mental health authorities 
are both within the DMH, which is housed along 



July 31, 1998 



105 



with the Office of Medicaid Policy and Planning in 
FSSA. 

Welfare Reform 

The State's TANF plan became effective in October 
1996. The plan denies TANF benefits to dmg felons 
but does not perform drug testing on eligibles. 

Child Welfare Demonstration Project: Provides tradi- 
tional child welfare services as well as wraparound 
services for multisystem children and the Healthy 
Families Indiana services, which provides home vis- 
itations for infants at risk in overburdened families. 
Child welfare, mental health, Medicaid, education, 
and juvenile justice all contribute funding to this 
project. 



County 

Not applicable. 

Evaluation Findings 



Hoosier Assurance Plan: Studies are currendy under 
way. 

The Dawn Project: The impact on cost is being 
evaluated now that some children are "graduating" 
from the program. 



Other Quantitative Data 



The Dawn Project: Present enrollment: 1 16 children. 



106 



{SAMHSA} Managed Care Tracking System 



IOWA 



OVERVIEW 

Iowa has two managed behavioral health care methods for Medicaid recipients: A statewide mental 
health stand-alone (Mental Health Access Plan — MHAP) and a statewide substance abuse stand- 
alone (Iowa Managed Care Substance Abuse Care Plan — IMSACP). Recently, the Department of 
Human Services and Department of Public Health awarded a contract to a private, for-profit behav- 
ioral health managed care organization (BHMCO) to manage the substance abuse and mental health 
programs under a single managed behavioral health care program. For the non-Medicaid population 
and services, Iowa's 99 counties have been required by State statute to develop county management 
plans to guide the expenditure of county and State funds. 



Managed Care Programs for Behavioral Health Services 

I Medicaid Waivers 

i Section 1915(b) - MHAP - mental health stand-alone. 

i Section 1915(b) - Iowa Managed Substance Abuse Care Plan (IMSACP) - substance abuse stand-alone. 

I Medicaid Voluntary 
Not applicable. 

II Other Managed Care Programs 
County Program - mental health stand-alone: Iowa's 99 counties have established their own mental 
health managed care plan for non-Medicaid beneficiaries or services. In addition, four counties were 
approved as adult decategorization demonstration sites to explore the feasibility of blending mental 
health funds into a single funding stream for the provision of mental health services. 




Geographic Location 

Section i9i5{h) -MHAP: Statewide. 

Section i9i5(b] - IMSACP: Statewide. 
County Program: Statewide by county. 

Status of Programs 

Section i9i5[h) - MHAP: Submitted April 1994,- 
approved June 6, 1994,- implemented March 1, 
1995. 

Section {9 i 5(b] - IMSACP: Submitted April 1995,- 
approved July 13, 1995,- implemented September 1, 
1995. 

County Program: Legislation passed in 1996 man- 
dated that each of the State's 99 counties establish 
its own mental health managed care plan for non- 
Medicaid beneficiaries or services. This program 
has been implemented in all 99 counties. 



Medicaid Substance Abuse Services 
Remaining Fee-For^Service 

Inpatient, outpatient, acute detoxification. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Inpatient; mental health support (e.g., targeted case 
management); pharmacy; outpatient (e.g., clinic 
services, nonphysician providers); residential (e.g., 
home health); Institution for Mental Diseases ser- 
vices for those under age 21. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section i9i5(h) - A4HAP; Counseling services provid- 
ed only to dually diagnosed individuals. 

Section i9i5(b) - IMSACP: Inpatient; acute 
detoxification (e.g., inpatient hospital); residential 




July 31. 1998 



107 



(e.g., medically monitored, primary, extended, 
halfway house),- outpatient (e.g., intensive, extend- 
ed individual, family, group). 

Three facilities (House of Mercy in Des 
Moines, Heart of lowa-ASAC in Cedar Rapids, and 
St. Luke's Gordon Recovery Center in Sioux City) 
provide a comprehensive array of substance abuse 
treatment and related services referred to as Women 
and Children Programs. As of December 1996, ser- 
vices provided by these programs are funded 
through a combination of IMSACP Medicaid and 
IMSACP non-Medicaid funding. 

Women and Children Programs: Supportive assis- 
tance for pregnant women and substance abusing 
women with dependent children in addition to 
other clinical and supportive services, residential, 
and transportation. 

Medicaid Mental Health Services in 
Managed Care Plan 

Section i9i5[b] - MHAP: inpatient,- outpatient (e.g., 
subacute care, 24-hour observation, partial hospital, 
day treatment, psychiatric physician services, psy- 
chologist and social worker services, community 
mental health centers),- support (e.g., targeted case 
management, community-support programs, 
assertive community treatment),- crisis (e.g., crisis, 
mobile counseling, 24-hour crisis including a toll- 
free hotline, respite services),- residential (e.g., crisis 
stabilization beds). 

Section I9i5[b) - IMSACP: Women and Children 
Programs: Outpatient. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

County Program: Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

County Program: Range of services varies by county. 
Counties are required to provide funding for inpa- 
tient services at the State mental health institutes, 
and to contract for community mental health ser- 
vices such as outpatient and community support, in 
addition, many counties provide a range of sup- 
portive services, such as case management, residen- 
tial care, treatment, and some level of employment 
support. 



Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section i9i5(b) - MHAP: Enrollee education,- public 
education (limited). 

Section i9i5[b] - IMSACP: Enrollee education. 

County Program: Public information. In addition, 
as part of counties' contracts with mental health 
centers, some counties have historically funded 
some activities such as crisis counseling in schools 
where a suicide has occurred, or other prevention 
programs. 

Populations Covered Under Managed 
Behavioral Health 

Section i9i5[b] - MHAP: Mandatory adults and chil- 
dren: Aid to Families with Dependent Children/ 
Temporary Assistance for Needy Families (AFDC/ 
TANF),- Supplemental Security Income (SSI),- dually 
eligible (Medicaid/Medicare),- pregnant women, up 
to 185 percent Federal poverty level (FPL),- infants 
under 1 year (up to 185 percent FPL),- children age 
1-5 (up to 133 percent FPL),- children age 6—18 (up 
to 133 percent FPL). 

Section i9i5(b] - IMSACP: Mandatory adults 
and children: AFDC/TANF,- SSI,- dually eligible 
(Medicaid/Medicare); pregnant women (up to 185 
percent),- infants under 1 year (up to 185 percent 
FPL),- children age 1-5 (up to 133 percent FPL),- 
children age 6-18 (up to 133 percent FPL). 

County Program: Adult consumers of public men- 
tal health and/or mental retardation services. 
Eligibility criteria vary by county and are required 
to be identified in the county management plans. 
Eligibility is based on a combination of diagnosis 
and financial need. There is a broader mandate for 
counties to serve persons with mental retardation. In 
some instances, eligibility can also vary by service. 
Most counties have lower eligibility criteria for 
funding mental health crisis services than for those 
services considered to be more discretionary. 

State Managed Care Program 
Administration 

Section i9i5(b) - MHAP: Iowa's Department of 
Human Services (DHS) contracts with a private, 
for-profit BHMCO to provide comprehensive men- 
tal health services and related substance abuse ser- 
vices. The State's responsibilities include monitor- 



108 



{SAMHSA} Managed Care Tracking System 



ing the financial status, administrative procedures, 
and quality of care delivered by the mental health 
managed care plan. 

BHMCO responsibilities include network man- 
agement, claims payment, utilization review, prior 
authorization, quality assurance, data report gener- 
ation, joint treatment planning, crisis counseling, 
and development of new treatment modalities. 

The BHMCO contracts with an open panel of 
clinicians (e.g., any willing provider of mental 
health services). Additionally, the BHMCO con- 
tracts with community mental health centers. 

Section {9i5[b] - IMSACP: Iowa Department of 
Public Health and Iowa DHS contract with a single 
not-for-profit agency as the primary contractor for 
Medicaid and public health populations. For the 
Medicaid population, the managed care organiza- 
tion (MCO) formed a public/private partnership 
through a subcontract with a private for-profit 
BHMCO (the same BHMCO operating the 
MHAP) to provide clinical and administrative ser- 
vices for the Medicaid population. 

For Medicaid, the open provider network con- 
sists of freestanding facilities, hospitals with sub- 
stance abuse treatment units (inpatient or outpa- 
tient), and community-based providers. This net- 
work has more than tripled since the introduction of 
managed care. For non-Medicaid, the MCO con- 
tracts with approximately 35 community-based 
providers and approximately 15 hospital-based 
providers. 

The MCO is responsible for overseeing perfor- 
mance for Medicaid and non-Medicaid under the 
IMSACP contract. For the Medicaid population, 
the subcontractor is responsible for data collection, 
provider relations, quality management, provider 
contracting, and payment and claims processing. 
For the non-Medicaid population, the providers are 
responsible for network development and service 
delivery. 

County Program: Iowa State legislation requires 
each county to manage its services and funds for 
persons with mental health, mental retardation, and 
developmental disabilities through a central point 
of coordination (CPC). There are a number of dif- 
ferent models that counties have employed for man- 
aging this system, including contracting with an 
MCO (Cerro Gordo County), contracting with 
another management entity (a number of counties 



in south central Iowa and Woodbury), and 28E 
agreements between counties to share management 
staff. In all other counties, the CPC is responsible 
for prior authorization/gatekeeping. 

Through the planning process, each county has 
determined the provider network. In most counties, 
this network is open and based on historical use. 
However, some counties have chosen not to con- 
tract with certain providers, usually where there is a 
question of the quality of care or a conflict over 
accountability. Providers primarily provide the 
direct services and may also have been designated as 
an "access point" to begin gathering the information 
for the CPC application. 

In Polk County, Polk County Health Services 
(PCHS), a nonprofit corporation, administers the 
mental health/mental retardation/developmental 
disabilities (MH/MR/DD) program and serves as 
the CPC. PCHS is the manager of the demonstra- 
tion project and contracts with four lead agencies in 
the demonstration. The lead agencies are nonprofit 
entities, a consortium of providers, who contract to 
provide all services necessary for their enrollees. 

Financing of Plans 



Section i9i5[h) - MHAP: Iowa's DHS contracts with a 
private, for-profit BHMCO on a prepaid capitated 
basis. MHAP fully capitates the provision of mental 
health services through the BHMCO, including 
claims payment and other administrative costs. The 
capitation rate has been set at 86 percent of the cost 
of Iowa's fee-for-service (FFS) program and contains 
a cost sharing provision. Some service dollars (about 
$1 million per year) are reinvested in community- 
based care to target high users of mental health ser- 
vices. The funds that remain after direct service pro- 
vision and reinvestment are divided between the 
State and MCO, 80 percent and 20 percent, respec- 
tively. The BHMCO is at full risk. Providers are 
paid on a negotiated FFS basis. DHS requires the 
BHMCO to negotiate with any county that wishes 
to blend its funds with the Medicaid funds adminis- 
tered by the BHMCO. To date, only one county 
has blended its funds with the BHMCO. 

Section i9i5(b] - IMSACP: The existing statewide 
substance abuse carve-out has several unique fea- 
tures. The plan integrates the administration of sub- 
stance abuse funds that were previously allocated to 



July 31, 1998 



109 



two different agencies, DHS for Medicaid and the 
Department of Public Health for the SAMHSA 
block grant. Funding streams for the Medicaid and 
public health populations remain separate. Inte- 
gration occurs at the contracting/administrative 
level. The BHMCO is at full risk for the Medicaid 
population. DHS established a capitation rate for 
Medicaid based on a percentage of the base year 
(1994) FFS cost. The State took savings off the top 
by setting the maximum at 86 percent of the upper 
payment limit. No state-ensured stop-loss protec- 
tion is provided. Providers bill the BHMCO on a 
claims basis. 

IMSACP providers serve eligible non- 
Medicaid clients on a standardized sliding-scale 
fee basis, based on income and family size. For the 
State-only public health populations, the substance 
abuse treatment providers are at risk. Substance 
abuse treatment providers receive a monthly allo- 
cation from Employee and Family Resources (EFR) 
to provide services to the non-eligible Medicaid 
population. 

County Program: Four of Iowa's 99 counties (Polk, 
Tama, Poweshiek, and Linn) are approved as 
demonstration sites to blend mental health funding 
streams, including Medicaid funds. The legislature 
directed DHS and vocational rehabilitation to work 
with the four adult decategorization counties to par- 
ticipate in the county planning process to determine 
the feasibility of decategorizing State, Federal, and 
county funds. 

The county MH/MR/DD services fund is used 
to pay for MH/MR/DD services for non-Medicaid 
individuals and for services not covered by 
Medicaid. The MH/MR/DD services fund is com- 
posed of county property tax levy funds, State 
appropriations for property tax relief. Social 
Services block grant funds and State appropria- 
tions for MH/DD community services fund. An 
established payment rate per person is paid to the 
lead provider in each county. Polk County has 
established a pilot project to explore an alternative 
funding mechanism. PCHS acts as the repository 
for all county-controlled mental health funds and 
deducts off the top of the rate money for adminis- 
trative expenses and for an incentive fund and risk 
pool. PCHS then pays the lead agencies in 
advance according to the number of consumers 
enrolled. 



Polk County funds are the sole source of fund- 
ing for the demonstration. There is a single rate for 
MR/DD enrollees ($9,177/year) and a single rate 
of $8, 1 1 1/year for enrollees with severe and persis- 
tent mental illness. PCHS removes 8 percent off 
the top using 2.5 percent for training expenses, 2.5 
percent for a risk pool, and 3 percent for an incen- 
tive fund. If the agency qualifies for incentive 
funds at the end of the year, by virtue of a good 
grade on its evaluation, then it receives those funds 
to use at its discretion for the benefit of enrollees 
in the project. 

In the other 98 counties, counties contract for 
services on a FFS basis. A few counties continue to 
fund community mental health centers on a block 
grant basis, however. Since the passage of Senate 
File 69, most counties are working on increasing the 
accountability of providers for the expenditure of 
county funds. 



Coordination Between Prinnary and 
Behavioral Health Care 



Section i9i5[b] - MHAP: For both carve-out waivers, 
coordination is handled in the same manner. The 
MHAP contractor is required to establish linkages 
with health maintenance organizations (HMOs) 
and the IMSACP contractor to ensure that client 
services are coordinated when those services require 
coordination among plans. The medical care home 
base for clients in the carve-out waivers varies. 
Some clients are served through the FFS Medicaid 
program, which means that care may be delivered 
by a variety of Medicaid providers. 

Section I9i5[b] - IMSACP: For both carve-out 
waivers, coordination is handled in the same man- 
ner. The IMSACP contractor is required to establish 
linkages with HMOs and the MHAP contractor to 
ensure that client services are coordinated when 
those services require coordination among plans. 
The medical care home base for clients in the carve- 
out waivers varies. Some clients are served through 
the FFS Medicaid program, which means that care 
may be delivered by a variety of Medicaid 
providers. 

County Program: There is no formal coordination 
of physical and mental health services under the 
county program. County funding of physical health 
care is fairly limited. Some coordination may be 



{SAMHSA} Managed Care Tracking System 



provided by the case manager, county social work- 
er, or provider agency. 

Consumer-Family Involvement 

Section i9i5[b] - MHAP: Statewide contractor con- 
ducts monthly consumer roundtables. The purpose 
of the consumer roundtables is to serve as a forum 
for discussion and exchange of information on new 
policies, to receive input and hear concerns. 
Performance indicators are designed by a subcom- 
mittee of the Council on Human Services and by 
the MHAP team which includes two consumers. 
The roundtables are conducted by the MHAP 
contractor and focus on the current MHAP con- 
tract. The roundtables have resulted in policy 
changes, consumer newsletter editing, and discus- 
sion of satisfaction survey findings. These con- 
sumer roundtables also supported the MCO's deci- 
sion to hire a part-time consumer representative 
and family member representative. 

Iowa's DHS services released a request for infor- 
mation (RFl) to solicit ideas about MHAP for year 3 
of the carve-out from the stakeholder community 
(consumers, providers). Most importantly, the feed- 
back from the RFI process has laid a foundation for 
the future of the MHAP. Responses to the RFl were 
received from the stakeholder community, includ- 
ing consumers, providers, and counties. Information 
was requested in three areas? performance indicators 
which might be used to assess the impact of MHAP,- 
suggestions about changes in the design of MHAP 
for the future,- and comments about the Consumer- 
Oriented Mental Health Report Card developed by 
a national committee working with the Center for 
Mental Health Services, SAMHSA. 

Section i9i5[b) - IMSACP: Provider and correc- 
tions groups and minority representatives/ 
advocates provided input in the implementation 
of the waiver. After implementation, Iowa State 
University conducted an independent assessment 
and surveyed consumers to evaluate consumer sat- 
isfaction in 1996 and again in 1997. The area of 
substance abuse treatment does not have strong 
consumer advocates,- therefore, providers tend to 
advocate for their clients. 

County Program: Counties were required to 
involve consumers and families in the development 
of the individual county plans. 



Future Plans 



Section i9i5(b) -MHAP: Will be subsumed under new 
integrated managed care program in January 1999. 

Section i9i5[b] - IMSACP: Will be subsumed 
under new integrated managed care program in 
January 1999. A second evaluation (see the 
Evaluation Findings Section) will be released 
September 1998. 

County Program: During the 1998 session, the 
Iowa Legislature passed a bill establishing some dif- 
ferent financing methodologies: per capita expendi- 
ture allocation, incentive and efficiency allocation, 
and a risk pool. It is anticipated that financing of the 
system will continue to evolve over the next few 
years. Additionally, counties continue to work on 
contracting and rate-setting methodologies with 
providers. 

* New Program Under Development: Iowa released 
its third and final draft entitled the Iowa Plan for 
Behavioral Health (Iowa Plan) in March. Primary 
responsibility of the plan will rest with DHS and 
the Department of Public Health who will provide 
monitoring of the ultimate contract. Pre-implemen- 
tation of this program will begin July 1, with the 
contract beginning on January 1, 1999. TTne plan 
integrates Medicaid, mental health, substance 
abuse, and State/Federal substance abuse treatment 
services under a single statewide contractor or mul- 
tiple regional contractors. The contractor will 
develop a regional provider network in order to 
decentralize the Iowa Plan. Consumers and families 
will participate on the Iowa Plan Advisory 
Committee. This program will serve all populations 
currently served by MHAP and IMSACP 

State Agency Administration 



Medicaid and Mental Health are housed under 
DHS. Medicaid is within DHS' Division of Medical 
Services, while Mental Health is in DHS' Division 
of Mental Health/Developmental Disability. 
Substance Abuse is in the Division of Substance 
Abuse and Health Promotion under the Iowa 
Department of Public Health. 

Welfare Reform 



Iowa's welfare reform plan provides parenting class- 
es for welfare recipients under age 18 who are 



July 31, 1998 



III 



required to participate. The classes are conducted as 
a component of the substance abuse prevention 
programs. They are cofunded by State agencies, 
including the Alcohol and Other Drug Department 
and the Work Force Development Department. 
Additionally, Iowa does not mandate drug testing to 
TANF recipients,- any TANF eligible convicted of a 
drug-related felony will be required to participate 
satisfactorily in a rehabilitation program or meet 
other requirements to demonstrate he or she isn't 
using or possessing controlled substances. 

County 

Described under "County Program" throughout 
profile. 

Evaluation Findings 



Section i9{5(h) - MHAP: In the first contract year, the 
following outcomes were discovered from the peri- 
od prior to implementation to year 1 to year 2 of the 
waiver: 

• Average length of stay decreased from 11.8 
days to 6 days in year 1 to 5 days in year 2. 

• Readmits to inpatient hospitals increased from 
25.5 percent to 29.5 percent in year 1 to 24.6 
percent in year 2. 



• Under the private, for-profit MCO's reinvest- 
ment program, 30 special projects were funded. 

Section i9i5(b)-IMSACP: An independent assessment 
evaluating the impact of managed care on substance 
abuse was completed in June 1997 by Iowa State 
University. TTie assessment found 

• The number of inpatient claims and lengths of 
stay for inpatient episodes dropped,- 

• The number of clients served primarily in out- 
patient services greatly increased,- 

• IMSACP clients were more likely than FFS 
clients to be continuing substance use,- 

• Satisfaction remained high and was not signifi- 
cantly different from the FFS system or from 
other medical services received under 
Medicaid, and 

• Generally the focus groups indicated that 
IMASCP had increased the range and proximi- 
ty of services, broadened the client base, imple- 
mented improved assessment criteria, and 
developed good pilot programs. 

Other Quantitative Data 

Not applicable. 



112 



{SAMHSA} Managed Care Tracking System 



KANSAS 



OVERVIEW 




Kansas does not manage behavioral health services under Medicaid. However, using State revenue 
dollars and Federal block grants, the Alcohol and Drug Abuse Services (ADAS) Division, located 
within the Department of Social and Rehabilitation Services (SRS), operates an Alcohol and Drug 
Managed Care Model. This statewide managed care program provides capitated substance abuse pre- 
vention and treatment services. Mental health services remain in the fee-for-service system. 

Additionally, SRS has privatized child welfare services and operates a family preservation, foster 
care, and adoption managed care project through a public/private partnership. 



Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 
Not applicable. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

Alcohol and Drug Managed Care Model - substance abuse stand-alone: substance abuse services: 
Regional assessment centers form the core of the system and refer clients for appropriate treatment 
after an initial assessment. 

Children and Family Ser^/ices (CFS) Privatization - integrated: Kansas is the first state to privatize the 
administration and delivery of child welfare services. In two of the five child welfare regions, a 
public/private partnership delivers family preservation services, adoption services and foster/group 
care while nonprofit providers provide services in the remaining three regions. 



Geographic Location 

Alcohol and Drug Managed Care Model Statewide. 
CFS Privatization: Statewide. 

Status of Programs 

Alcohol and Drug Managed Care Model Implemented in 
three phases. A pilot with treatment funds only was 
implemented in the Wichita/Hutchinson region in 
1995-96. Statewide implementation began in fall 
1996 for both prevention and treatment services. 
Federal block, grant set-asides are tracked through 
the contracts and the management information out- 
come system. 

CFS Privatization: First year contracts ran from 
Febmary 1, 1997 to January 31, 1998. 



Medicaid Substance Abuse Services 
Remaining Fee-For^Service 



Inpatient, outpatient, crisis, detoxification, residen- 
tial. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Inpatient, outpatient, mental health support, mental 
health rehabilitation, crisis. Institution for Mental 
Diseases services for individuals over age 65 and 
under age 2 1 . 

Medicaid Substance Abuse Services in 
Managed Care Plan 



Not applicable. 



July 31, 1998 



I 13 



Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Alcohol and Drug Managed Care Model Detoxification, 
outpatient, residential. 

CFS Privatization: Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 



Alcohol and Drug Managed Care Model. Not applicable. 
CFS Privatization: Inpatient, crisis, mental health 
support, outpatient, mental health rehabilitation. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Alcohol and Drug Managed Care Model Prevention ser- 
vices are focused on 1 3 regional prevention centers 
that facilitate a community development/mobiliza- 
tion process to reduce risk and increase protective 
factors. 

CFS Privatization: Crisis services are available to 
preserve the family and prevent out-of-home place- 
ments for the child(ren). 

Populations Covered Under Managed 
Behavioral Health 



Alcohol and Drug Managed Care Model Voluntary adults 
and children: The focus is on those who meet fed- 
eral poverty guidelines (200 percent of Federal 
poverty level) which includes those formerly or cur- 
rently on Supplemental Security Income. 

CFS Privatization: The children served by the 
CFS contractors fit within several categories. Some 
of the children are designated as "children in need 
of care," some meet Medicaid eligibility guidelines,- 
some are in the custody of the Secretary of SRS,- and 
some may be juvenile offenders. 

State Managed Care Program 
Administration 

Alcohol and Drug Managed Care Model There are many 
partners and stakeholders in the Kansas Alcohol 
and Drug Managed Care framework, including 
providers, consumers, and citizens. The managed 



care framework, however, is predicated upon specif- 
ic roles for three entities — SRS/ADAS, the Regional 
Alcohol and Drug Assessment Centers (RADACs), 
and the management organization. The system 
design deliberately separates administrative and 
clinical decisions. 

The State provides leadership for the managed 
care infrastructure. The State's primary role is to 
communicate State policy, program direction, and 
desired outcomes regarding prevention and treat- 
ment to the contractors,- to evaluate program and 
service effectiveness,- to evaluate program and 
RADAC data to identify gaps in services,- and to 
monitor the performance of the management orga- 
nization and the RADACs. 

The State's clinical partners, the RADACs, are 
the driving force of the treatment system. Their pri- 
mary role is to provide a central point of entry to 
substance abuse treatment services, including deter- 
mination of financial eligibility, clinical assessment 
for substance abuse including use of the Kansas 
Client Placement Criteria and referral to an appro- 
priate substance abuse treatment program,- to pro- 
vide timely assessments and reviews within estab- 
lished guidelines,- and to identify services gaps with- 
in their region in the continuum of care. 

The State's administrative/management partner, 
an administrative services organization, has as its 
primary role to maintain and monitor the full com- 
plement of treatment and prevention services, 
including negotiating contracts,- to meet service 
gaps identified through the RADACs and ADAS,- to 
provide timely, accurate and appropriate payments,- 
and to ensure federal block grant and other require- 
ments are met by subcontractors through compli- 
ance monitoring. 

CFS Privatization: SRS has entered into a con- 
tractual relationship with a private agency for the 
administration and delivery of child welfare ser- 
vices. In the five child welfare regions, a Kansas- 
based private, nonprofit provider provides all 
behavioral health services. All CFS contractors 
(subcontractors to the lead agency) provide assess- 
ments, overall case planning and coordination, and 
direct treatment services as well as administer the 
provided services, quality management, provider 
relations, information systems, and claims adminis- 
tration. SRS maintains the overall responsibility for 
the case plans and goals for children in SRS cus- 
tody. SRS is responsible to the court system and to 



14 



{SAMHSA} Managed Care Tracking System 



the community for the services delivered to chil- 
dren in SRS custody and for monitoring the 
progress of the CFS contractors in meeting specif- 
ic case plan goals and overall foster care program 
goals. 

Financing of Plans 



State Agency Administration 



Alcohol and Drug Managed Care Model Federal block 
grants and State appropriations fund the program. 
The RADACs are paid through an SRS/ADAS 
grant. The capitated rates, paid by the management 
organization, are based on historical data, popula- 
tions that meet the guidelines, and a formula from 
the Center for Substance Abuse Treatment (CSAT). 
The management organization receives $500,000 
for administration. Any savings are reinvested in 
program services. 

CFS Privatization: Medicaid, Title IV-E, and State 
general dollars fund this program. SRS assumes full 
financial risk. Funding is combined into a case rate. 
The case rate was determined based upon historical 
data reflecting past costs for SRS services to chil- 
dren. Any generated savings are to be reinvested in 
services. 

Coordination Between Primary and 
Behavioral Health Care 

Alcohol and Drug Managed Care Model Unless the con- 
sumer is referred directly from the hospital, there is 
no clear-cut coordination with ADAS and physical 
health care providers. 

CFS Privatization: The CFS contractors assist in 
the coordination of services, Medicaid-eligible chil- 
dren must have early and periodic screening, diag- 
nosis, and treatment (Kan Be Healthy) as part of the 
contractual agreement. 

Consumer-Family Involvement 

Alcohol and Drug Managed Care Model Consumers were 
involved in the development of this program. 

CFS Privatization: Prior to the issuance of the 
request for proposals (RFPs) for CFS contracts, 
input was solicited from community agencies, the 
court system, and foster parents. 

Future Plans 



Alcohol and Drug Managed Care Model None. 
CFS Privatization. None. 



The SRS houses all three agencies: Medicaid, 
Mental Health, and Substance Abuse. Medicaid 
falls under the Adult and Medical Services Division, 
Mental Health under Mental Health and Develop- 
mental Disabilities Division, and Substance Abuse 
under ADAS. 

Welfare Reform 

• The Kansas Welfare Reform Plan emphasizes 
providing services for welfare clients who need 
help with substance abuse problems. The State 
has implemented a comprehensive screening, 
assessment, treatment, and outcome monitoring 
protocol. A preliminary screening, conducted 
by the welfare office, looks for signs of intoxi- 
cation, dismissal from employment for sub- 
stance abuse-related causes, addiction-related 
legal problems, acknowledgment by client of 
substance abuse problem, or a positive result on 
the CAGE screening instrument. If the screen- 
ing is positive, the client is referred to a 
RADAC for an assessment and treatment place- 
ment. The five assessment centers monitor 
progress, approve continuing care, and dis- 
charge. The assessment center works with the 
substance abuse provider to determine when 
the client is in recovery and ready to resume 
employment activities. The assessment and 
treatment components are funded by substance 
abuse sources. If a client is Medicaid eligible 
and has committed a drug felony, he or she will 
be denied coverage. 

• Kansas' Welfare to Work grant submitted to the 
U.S. Department of Labor on December 12, 
1997, and approved on March 2, 1998, will be 
administered by the Department of Human 
Resources, within SRS. The sources of match- 
ing funds and percentage of local. State, and 
private in-kind will be determined by the 1998 
Kansas legislative session. The 15 percent of 
State project funds will be used based on pro- 
posals from Private Industry Councils, govern- 
mental entities, community-based organiza- 
tions, and community development corpora- 
tions to fund diverse activities. The substate 
allocation for the remaining 85 percent will be 
split between Temporary Assistance for Needy 
Families (TANF) and the poor. 



July 31, 1998 



115 



County 



In Kansas, the primary local coordinating agency 
for community-based mental health services is the 
licensed community mental health center. There are 
30 of these located across Kansas. Some of these are 
incorporated as part of the local county government 
and some are freestanding entities that receive part 
of their funding from local government. The State 
also provides a substantial amount of public funding 
for these centers. They are all licensed by the 
Division of Mental Health and Developmental 
Disabilities. 

Evaluation Findings 

Alcohol and Dru^ Managed Care Model SRS/ADAS 
funds Kansas State University to conduct evalua- 
tions on clients 6 months after discharge from treat- 
ment. ADAS also is implementing a CSAT Treat- 
ment Outcome study that includes an evaluation of 
the managed care model. 



CFS Privatization: James Bell Associates external 
review services will provide a systematic review of 
all elements of the child welfare system,- state man- 
agement, quality control, and oversight, state ser- 
vice delivery,- and private agency delivery of family 
preservation, foster care/reintegration, and adoption 
services. The review contract began in February 
1998. 

Additionally, SRS will monitor five general cat- 
egories of outcomes, including the safety of chil- 
dren from maltreatment while in placement; num- 
ber of placements after referral to KanCare for 
Families,- the maintenance of family, community, 
and cultural ties,- the amount of time for family 
reunification,- and client satisfaction. 

Other Quantitative Data 

Not applicable. 



116 



{SAMHSA} Managed Care Tracking System 



KENTUCKY 



OVERVIEW 




Kentxicky is preparing to implement a managed care waiver specific to behavioral health services. 
The State received approval for two waivers: one for primary care and a stand-alone model for behav- 
ioral health. The 1115 physical health waiver includes mental health services delivered by primary 
care providers and inpatient medical detoxification. The behavioral health waiver is a 1915(b) waiv- 
er, entitled Kentucky Access, which will be implemented in conjunction with the phase-in of the 
physical health program. Health Care Partnerships. Kentucky is the only State in the country to han- 
dle its entire Medicaid population through regional noncompetitive provider networks. If this 
approach does not prove effective, the State will move to a competitive bidding process. 

Similar to the physical health care program. Access will be implemented on a region -by-region 
basis by partnerships of public and private behavioral health care providers. 

Managed Care Programs for Behavioral Health Services 



I Medicaid Waivers 

I Section 1915(b) -Access - behavioral health stand-alone: Risk-based carve-out managed behavioral 

I health care program. 

I Section 1115- Health Care Partnerships - general health - Integrated: Primary health managed care 

I program. 

i Medicaid Voluntary 

I 

I Not applicable. 

I Other Managed Care Programs 

I Not applicable. 



Geographic Location 



Section 19 i 5(b) - Access.- Will be implemented on a 
regional basis until statewide. Kentucky has been 
divided into eight managed care regions. 

Section iiis - Health Care Partnerships: Implemented 
on a regional basis until statewide. Kentucky has 
been divided into eight "Partnership" regions. 

Status of Programs 

Section i9i5(h) -Access: Submitted December 1996. 
Approved March 7, 1997. Regions 3 and 5 Access 
target date is November 1998. Remaining Access 
plans managed behavioral health care organiza- 
tions (MBHOs) will be implemented with Health 
Care Partnerships. Scheduled to be implemented 
on the same schedule as the Health Care 
Partnerships program. 



Section ms - Health Care Partnerships: Approved 
October 1, 1995. Partnerships began serving clients 
in Region 3 on July 1, 1997, and in Region 5 on 
November 1, 1997. Remaining regions will be 
phased in beginning in the winter of 1998. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 



Detoxification. 

Medicaid Mental Health Services 
Remaining Fee-For^Service 



Inpatient; outpatient (e.g., clinic services, commu- 
nity mental health centers (CMHCs)),- Institution 
for Mental Diseases (IMD) services (for individuals 
age 65 and over and age 21 and under), mental 
health rehabilitation (CMHC and targeted case 
management). 



July 31, 1998 



117 



Medicaid Substance Abuse Services in 
Managed Care Plan 

Section 19 l5(h') - Access: For adults with serious mental 
illness, detoxification. 

Section iH5 - Health Care Partnerships-. Acute detox- 
ification. 

Medicaid Mental Health Services in 
Managed Care Plan 

Section i9i5{h) - Access. Inpatient,- outpatient (e.g., 
psychiatry and licensed or certified practitioners); 
IMD services,- mental health rehabilitation (CMHC 
and targeted case management), mental health resi- 
dential (e.g., residential crisis stabilization), mental 
health support (e.g., community and family support, 
"IMPACT Plus" children's services, transportation ),- 
prescription drugs (e.g., pharmacy). 

Section ni5 - Health Care Partnerships-. Crisis 
(e.g., emergency room),- mental health outpatient 
(e.g., primary care visits),- prescription drugs (e.g., 
pharmacy). 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Section i9i5{h]: Preventive services. 

Section iii5 - Health Care Partnerships. Early and 
periodic screening, diagnosis, and treatment 
(EPSDT) and wellness programs. 

Populations Covered Under Managed 
Behavioral Health 



Section i9i5{h) - Access. Children and adults manda- 
tory: Aid to Families with Dependent Children/ 
Temporary Assistance for Needy Families (AFDC/ 
TANF); Supplemental Security Income (SSI),- 
Seventh Omnibus Budget Reconciliation Act 
(SOBRA), dually eligible, foster care, psychiatric 
child. 



Section ms - Health Care Partnerships: Children 
and adults mandatory: AFDCAANF, SSI, SOBRA, 
dually eligible, foster care, psychiatric child. 

State Managed Care Program 
Administration 

Section i9i5(h] - Access. The Department for 
Medicaid Services will be responsible for overall 
implementation of Kentucky Access, and will con- 
tract with MBHOs organized by coalitions of 
behavioral health care providers. Medicaid will 
issue an invitation for traditional Medicaid behav- 
ioral health providers to register jointly as an 
MBF40. There are no requirements for nonprofit 
status. The MBHO will provide governance and 
provide and arrange for covered services on an at- 
risk, prepaid capitated basis. Coalitions must 
include a representative of a regional mental 
health/mental retardation board, an acute care 
hospital with inpatient psychiatric services, a com- 
munity-based agency or a psychiatric residential 
treatment facility, a mental health professional, 
and the Department of Psychiatry Chairperson at 
the School of Medicine within the region. If a 
coalition forms and demonstrates ability to man- 
age behavioral health care, Medicaid will contract 
with the MBHO that is organized by the coalition. 
If a single coalition cannot form or its application 
does not meet requirements, Medicaid will request 
competitive applications. Provider coalitions may 
still apply, but on a competitive basis with other 
organizations. No contract has been formalized. 
Organizers of coalitions have been recognized in 
Regions 3 and 5 and have been sent applications to 
become an MBHO. 

Section iiis - Health Care Partnerships: The De- 
partment for Medicaid Services has lead responsi- 
bility for this program, which contracts with 
provider organizations called Partnerships. A 
regional Partnership consists of representatives of 
all current Medicaid providers. The Partnerships 
enter into legal relationships with a Kentucky- 
licensed health maintenance organization 
(HMO), and together (as one entity or two) con- 
tract with Medicaid. Any willing provider may 
participate. 



118 



{SAMHSA} Managed Care Tracking System 



Financing of Plans 

Section i9i5 - Access. The program is funded by 
Medicaid. The MBHOs will be paid at a full-risk 
capitated rate. The capitation rate was established 
by actuaries using trended historical data. Providers 
are paid by the MBHO through subcontracts. 

Section ms - Health Care Partnerships-. Medicaid is 
the source of funds. Partnerships are at full risk and 
receive a capitated payment for each recipient's 
care. The capitation rate was established by actuar- 
ies using trended historical data. The State estimates 
it will save $31 million in its first year and roughly 
$ 1 1 7 million a year thereafter. Savings from the plan 
will be put into a trust fund earmarked for future 
expansion of Medicaid. 

Coordination Between Primary and 
Behavioral Health Care 

Section i9i5{h) -Kentucky Access-. Coordination of care 
is required by the MBHO and Health Care 
Partnership contract. In addition, the MBHO and 
Partnership in each region must have a local agree- 
ment that includes a coordinating function. 

Section ms - Health Care Partnerships: Coordi- 
nation of care is required by the MBHO and Health 
Care Partnership contract. In addition, the MBHO 
and Partnership in each region must have a local 
agreement that includes a coordinating function. 

Consumer-Family Involvement 



Section I9i5(h] - Kentucky Access: Governing boards 
for regional plans must have five consumer, family, 
or parent members. Monitoring will be provided by 
units established in the Cabinet and advised by 
committees that include consumers and other stake- 
holders. The involved departments, consumers, 
family members, and other stakeholders have devel- 
oped a set of quality outcomes and performance 
standards that the Cabinet will require of managed 
care organizations in Kentucky Access. 

Section ms - Health Care Partnerships: Medicaid 
and each Partnership have advisory committees that 
include consumers and family members. 

Future Plans 

Section i9i5[b] - Kentucky Access: Anticipated savings 
are planned to expand the array of services to divert 



beneficiaries from inpatient hospitalization. Such 
services include after-school programs for children 
and adolescents,- partial hospitalization,- residential 
care,- crisis services, therapeutic foster care,- and con- 
sumer support services. 

Section ms - Health Care Partnerships: Savings will 
be used to expand Medicaid eligibility coverage to 
under- or uninsured citizens. 

State Agency Administration 



The Medicaid authority stands alone in the 
Department for Medicaid Services. The substance 
abuse authority is the Division of Substance Abuse, 
within the Department of Mental Health/Mental 
Retardation Services, which is the mental health 
authority. The Department of Mental Health/ 
Mental Retardation Services and the Department of 
Medicaid Services are within the Cabinet for 
Health Services, which is accountable to the 
Governor. 

Welfare Reform 



TANF program went into effect on October 1 8, 
1996. The program denies TANF benefits to drug 
felons but does not require drug testing of its 
recipients. 

The State's Welfare-to-Work (WtW) plan 
became effective December 31, 1997, and is admin- 
istered by the Cabinet for Families and Children. 
The goals of the program are to place and retain 
recipients in unsubsidized employment and to 
increase earnings to a predefined level. As a result of 
this program, demand for substance abuse services 
has increased. Medicaid and the Substance Abuse 
division are applying for a waiver to serve this pop- 
ulation. One hundred percent of the matching 
funds are State dollars. The State project funds are 
intended to address substance abuse and domestic 
violence in the State. Fifty percent of the substate 
allocation is intended for poor individuals, and 50 
percent for TANF recipients. There is a written 
agreement to define the roles of the local WtW 
entities and the local TANF agencies. 

County 



Not applicable. 



July 31, 1998 



119 



Evaluation Findings 



Studies of the impact of public sector managed care 
on access, quality, cost, or outcomes have begun but 
are not yet complete. 

Other Quantitative Data 

Section i9i5(h] - Access: Access will use the Mental 
Health Statistics Improvement Program approach, 
including its consumer satisfaction survey and clin- 
ical outcomes developed for CMHCs and state 
facilities. 



120 {SAMHSA} Managed Care Tracking System 



LOUISIANA 



OVERVIEW 



Louisiana is about to implement a 1915(b) waiver in Region 3, which will include some mental health 
services. Substance abuse is not covered by the program and remains in the fee-for-service system. 

Managed Care Programs for Behavioral Health Services 

II Medicaid Waivers J) 

I Section 1915(b) - Pilot - physical health - integrated: Health maintenance organization (HMO) program. | 

II Medicaid Voluntary | 
Not applicable. | 

I Other Managed Care Programs p 

I Not applicable. i 




Geographic Location 



Section i9i5[b) -Pilot: Region 3, which includes seven 
parishes (Assumption, Lafourche, St. Charles, St. 
James, St. John the Baptist, St. Mary, and Terre- 
bonne). 



Status of Programs 






Section I9i5(b] - Pilot: Submitted October 31, 1997; 
pending approval. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Outpatient services (e.g., clinic services). 

Medicaid Mental Health Services 
Remaining Fee-For^Service 



inpatient; outpatient (including clinic services); 
Institution for Mental Diseases services for individ- 
uals age 65 and over and age 21 and under; mental 
health rehabilitation. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section i9i5[b] - Pilot: Not applicable. 

Medicaid Mental Health Services in 
Managed Care Plan 

Section i9i5[b) -Pilot: Outpatient, crisis, inpatient. 



Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Section i9i5[b) - Pilot: Early intervention services. 

Populations Covered Under Managed 
Behavioral Health 



Section i9i5[b] - Pilot: Children and adults mandato- 
ry: Aid to Families with Dependent ChildrenATemp- 
orary Assistance for Needy Families (AFDGTANF); 
Seventh Omnibus Budget Reconciliation Act 
(SOBRA). 

State Managed Care Program 
Administration 

Section i9i5(b) - Pilot: The Medicaid agency will con- 
tract with HMOs, which will provide all services. 
The FiMOs must meet strict criteria and will be 
selected through a competitive process. The pro- 
gram has established a linkage with community 
mental health centers in Region 3 for children who 
meet certain criteria. 



July 31, 1998 



121 



The health benefits manager (HBM) will serve 
as a buffer and facilitator between the HMOs and 
the Medicaid recipients. The HBM will establish 
education and outreach programs to provide easy- 
to-understand information to help the recipients 
choose from the plans offered by the HMOs, and 
the HBM will enroll the recipients into the HMO of 
their choice and with the primary care doctor of 
their choice. HMOs will not be allowed to market 
their programs directly to the recipients. The recip- 
ients will have 15 days in which to choose a plan 
and a doctor. If a recipient does not choose a plan 
or doctor, that recipient will be assigned to one for 
6 months. During the first 30 days, recipients can 
change plans or doctors, if they desire. After 30 
days, they are committed for 5 months to the plan 
they choose. After 6 months' enrollment, recipients 
may change plans or doctors. 

Financing of Plans 



Section i 9 i 5(b) - Pilot: Medicaid is the source of funds. 
HMOs will be at full risk for all services and paid a 
capitated rate. 

Coordination Between Primary and 
Behavioral Health Care 



Section i9i5(h) - Pilot: The program requires that the 
primary care provider collaborates with behavioral 
health specialists. 

Consumer-Family Involvement 

Section i9i5[b] -Pilot: Not applicable. 

Future Plans 

Section i9i5(h] - Pilot: Integration is the goal of 
Louisiana's 1915 waiver. The State hopes to gradu- 
ally go statewide with this program. 

State Agency Administration 



The Medicaid authority in Louisiana is the Bureau 
of Health Services Financing, which is housed with- 
in the Department of Health and Hospitals. The 
Department of Health and Hospitals also houses 
the substance abuse authority, the Office of Alcohol 
and Drug Abuse, and the mental health authority, 
the Office of Mental Health. 



Welfare Reform 

Louisiana's TANF program became effective January 
1, 1997. It denies TANF benefits to drug felons. 
While the State does not currently test recipients 
for drug use, the Governor's Drug Task Force has 
released an implementation design that would 
include random drug testing for welfare recipients. 
Louisiana's Welfare-to-Work plan was submit- 
ted to the Department of Labor on December 15, 
1997, and was approved February 3, 1998. The per- 
formance goals of the program are to provide place- 
ment in unsubsidized jobs and increase duration of 
placements and earnings. TTie administering agency 
is the Department of Labor. Fifty percent of match- 
ing funds will come from the State,- the other 50 
percent will come from local and private sources. 
The intended use of State project funds are light- 
house projects with State-regional partnership 
agencies, incentive funds for Private Industry 
Councils exceeding performance goals and innova- 
tive demonstration projects, and statewide capacity 
building projects. Substate allocations will go equal- 
ly to poor individuals and TANF recipients. 

County 

Not applicable. 

Evaluation Findings 



External parties, such as the Department of 
Insurance, the Federal government, and an external 
quality review organization, will assess and monitor 
the overall effectiveness of the project. 

Other Quantitative Data 

In Region 3 in 1995-96, the State spent about $56 
million for health care services for about 28,000 
AFDC and SOBRA recipients. The Federal govern- 
ment requires that the managed care pilot program 
be cost neutral. On the basis of the experiences of 
other States, the project should meet that require- 
ment the first year, should realize savings of 5 per- 
cent in the second year and, if renewed, should gen- 
erate substantial cost reductions and avoidances in 
the third and later years. 



122 



{SAMHSA} Managed Care Tracking System 



MAI NE 



OVERVIEW 



Currently, behavioral health services are not included in Maine's voluntary Medicaid managed care 
program for 1915(b) Temporary Assistance for Needy Families (TANF) populations. However, the 
Medicaid Agency has adopted a rule to make the program mandatory and has included a basic men- 
tal health and substance abuse benefit. Adults with serious mental illness and children with severe 
emotional disturbance will continue to be excluded from the managed care program. 

A separate Medicaid managed care program for elderly and disabled populations with acute care 
needs is being developed. A third initiative is being developed for long-term mental health and sub- 
stance abuse services. The Department of Mental Health, Mental Retardation, and Substance Abuse 
Services (DMHMRSAS) is designing a program to combine Medicaid and non-Medicaid funding. It 
will cover all individuals not covered by the two acute care programs. 




Managed Care Programs for Behavioral Health Services 



I Medicaid Waivers 

Section 1915(b) - Medicaid Managed Care Initiative (MMCI) - integrated with no behavioral health at 
present time. 

II Medicaid Voluntary 
Not applicable. 

I Other Managed Care Programs 
I Not applicable. 



tSKSSSawSKtiSSWKSS^^ 



Geographic Location 

Not applicable. 

Status of Programs 

Not applicable. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Inpatient,- outpatient (e.g., client services),- detoxifi- 
cation,- opiate treatment program (e.g., methadone 
treatment). 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Inpatient (e.g., clinic services and counseling),- 
Institution for Mental Diseases (IMD) services for 
individuals age 65 and over and age 21 and under,- 
mental health rehabilitation (e.g., targeted case 
management). 



Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Medicaid Mental Health Services in 
Managed Care Plan 



Not applicable. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Not applicable. 



July 31, 1998 



123 



Populations Covered Under Managed 
Behavioral Health 



Not applicable. 

State Managed Care Program 
Administration 

Not applicable. 

Financing of Plans 

Not applicable. 

Coordination Between Primary and 
Behavioral Health Care 



Section i9i5[b) - MMCL Coordination between pri- 
mary and behavioral health care is through the 
client's primary care physician. 

Consumer-Family Involvement 

Section I9i5[h] -MMCL Not applicable. 

• DMHMRSAS has convened a managed care 
steering committee composed of consumers, 
representatives from providers, advocacy orga- 
nizations, and relevant State agencies to advise 
the Department as it plans for behavioral health 
managed care. 

Future Plans 



Section i9i5(b] - MMCL Basic behavioral health ser- 
vices will be phased into the program when it 
becomes mandatory. Medicaid has included a 20/30 
for adults and 0/20 for children (inpatient/outpa- 
tient days or visits) behavioral health benefit that 
will be in place at least until a separate program is 
developed by DMHMRSAS. 



'k New Program Under Development: The Depart- 
ment of Human Services has submitted an 1115 
waiver to establish a long-term care demonstration 
program for elderly and disabled populations. Plans 
call for behavioral health services for elderly 
enrollees with acute needs to be included. 

* New Program Under Development: DMHMRSAS 
is developing a separate managed care initiative for 
long-term care services. Plans call for combining 
Medicaid and State funding for mental health and 
substance abuse services. 

State Agency Administration 

The State's Medicaid authority is the Bureau of 
Medical Services, within the Department of Human 
Services. DMHMRSAS is the State's mental health 
and substance abuse authority. 

Welfare Reform 

Maine's TANF program became effective November 
1, 1996, and was certified complete on December 
27, 1996. TTie program denies TANF benefits to 
drug felons, but does not require drug testing of its 
recipients. 

County 

Not applicable. 

Evaluation Findings 

Section i9{5(h] - TANF program: Health Employer 
Data Information Set (HEDIS) compliance is not 
required; similar data are collected. No studies have 
been conducted. 



Other Quantitative Data 

Not applicable. 



124 



{SAMHSA} Managed Care Tracking System 



MARYLAND 



OVERVIEW 



Maryland's Section 1115 provides a seamless system of care of mental health, substance abuse, and 
physical health services to Medicaid recipients. Substance abuse services (as well as six other cate- 
gories of special needs care) are provided by managed care organizations (MCOs) as part of 
HealthChoice physical health plan. Mental health services are provided by both MCOs and the spe- 
cialty mental health system (SMHS). MCOs are responsible for providing "primary mental health 
services," which are the clinical evaluation and assessment of services needed by an individual and the 
provision of services, or referral for additional services as deemed medically necessary and appropri- 
ate by the primary care provider. The SMHS is administered by the Mental Hygiene Administration 
(MHA), in conjunction with local Core Service Agencies (CSAs) and a behavioral health company 
that assists them with administration and monitoring of the SMHS. On July 1, 1997, Medicaid fund- 
ing for specialty mental health was combined with the resources of MHA to provide a single stream 
of funding to CSAs for mental health services for Medicaid recipients and the uninsured. The MHA 
contracts with a behavioral health managed care firm for administrative and monitoring services. 

Before the waiver, Maryland Medicaid had approximately 120,000 voluntarily enrolled 
Medicaid eligibles in health maintenance organizations (HMOs). For these individuals, HMOs 
were responsible for physical health, mental health, and substance abuse services, except 
Institution for Mental Diseases (IMD) services for persons under age 21 and over age 65. Upon 
implementation of the waiver, this system was converted from a voluntary to mandatory system. 




Managed Care Programs for Behavioral Health Services 

I Medicaid Waivers 
Section 1115- HealthChoice - general health - partial carve-out for mental health. 

i Medicaid Voluntary 
Not applicable. 

II Other Managed Care Programs 
Not applicable. 




Geographic Location 

Section ms -HealthChoice: Statewide. 

Status of Programs 



Section iH5 - HealthChoice: Submitted to the Health 
Care Finance Administration (HCFA) May 3, 
1996, approved October 30, 1996, implementa- 
tion of the changes to the public mental health 
system began on June 2, 1997, service provision 
under the managed care system began July 1, 
1997, 



Medicaid Substance Abuse Services 
Remaining Fee-For^Service 



All Medicaid services provided to non-Health- 
Choice recipients are provided on a fee-for-service 
(FFS) basis. For individuals age 21 years and over, 
who are dually eligible or institutionalized, FFS- 
type services include substance abuse treatment 
services (e.g., outpatient treatment, narcotic treat- 
ment with methadone and LAAM, intensive outpa- 
tient treatment; emergency residential ho?pital 
detoxification). 

For individuals under age 21 who are dually 
eligible or institutionalized, Medicaid FFS includes 



July 31, 1998 



125 



substance abuse treatment services (e.g., out- 
patient treatment; intensive outpatient treatment,- 
narcotic treatment and methadone and LAAM 
for individuals age 18 to 21 only,- intermediate 
care,- group home,- emergency residential hospital 
detoxification). 

For Temporary Cash Assistance (TCA) recipi- 
ents covered under Medicaid FFS through welfare 
reform, services include substance abuse treatment 
services (e.g., intermediate care, halfway house, 
therapeutic community, group home) to adult and 
minor parents. TCA recipients receive all of the 
approved substance abuse treatment benefits under 
the HealthChoice program through the capitation 
received by the participating MCO. The services to 
TCA listed under the FFS category are in addition 
to the MCO capitation. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 



Inpatient; outpatient (e.g., partial hospitalization, 
psychiatric rehabilitative programs, mobile treat- 
ment, community mental health programs); IMD 
services for individuals under age 21 and age 65 
and over; mental health rehabilitation (e.g., target- 
ed case management); expanded early and period- 
ic screening, diagnosis, and treatment (EPSDT) 
services. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section ms - HealthChoice: Outpatient (e.g., case 
management, diagnostic screening for substance 
abuse such as CAGE or MAST, comprehensive 
substance abuse assessment and placement criteria, 
counseling, intensive outpatient for pregnant 
women); detoxification (outpatient, inpatient if 
medically necessary); residential substance abuse 
treatment programs (e.g., intermediate care facili- 
ties for individuals under age 2 1 ); opiate treatment 
programs (e.g., methadone maintenance). For per- 
sons with F^iV/AlDS and pregnant substance- 
abusing women, MCOs must provide access to 
substance abuse services within 24 hours of 
request. MCO providers also refer TCA adult and 
minor parents under welfare reform to the follow- 
ing services; intermediate care facilities for addic- 
tions, halfway houses, group homes, therapeutic 
communities. 



Medicaid Mental Health Services in 
Managed Care Plan 

Section ms - HealthChoice: Mental health services are 
managed by MCOs and the SMF4S which is admin- 
istered by MF^A and paid for on an FFS basis. (See 
Program Administration Section for more details.) 
Primary mental health services (the clinical evalua- 
tion of assessment of services needed by an individ- 
ual and the provision of services, or referral for addi- 
tional services as deemed necessary by the primary 
care provider) are provided by MCOs. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 



Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section 1H5 - HealthChoice: As of October 1, 1998, 
MCOs will be required to use standardized assess- 
ment and placement instruments: the Problem 
Oriented Screening Instrument for Teenagers 
(POSIT), the Addiction Severity Index (ASI), and 
the American Society of Addictions Medicine 
Patient Placement Criteria (2"" edition ASAM 
PPC-2). Primary care providers must conduct a sub- 
stance abuse screening for all enrollees as part of 
their mandatory health assessment. TTie MCO must 
provide preventive and intervention services to the 
children. For persons with HIV/AIDS and pregnant 
substance-abusing women, MCOs must provide 
access to substance abuse services within 24 hours 
of request. MCO providers also refer TCA adult 
and minor parents under welfare reform to the fol- 
lowing services: intermediate care facilities for 
addictions, halfway houses, group homes, therapeu- 
tic communities. 

Populations Covered Under Managed 
Behavioral Health 

Section iH5 - HealthChoice: Children and adults 
mandatory: Aid to Families with Dependent 
Children/Temporary Assistance for Needy Families 
(AFDC/T\NF), Supplemental Security Income, 



126 



{SAMHSA} Managed Care Tracking System 



Seventh Omnibus Budget Reconciliation Act, unin- 
sured and underinsured. 

State Managed Care Program 
Administration 

Section Hi5 - HealthChoicc: Maryland's Department of 
Health and Mental Hygiene (DHMH) contracts 
with nine MCOs to provide a comprehensive range 
of services, including substance abuse prevention 
and physical health promotion. MCOs can be 
licensed HMOs or new non-HMO organizations 
meeting the definition of MCO developed by the 
Maryland Insurance Administration (MIA) and 
DHMH. The same high quality and access stan- 
dards apply to all MCOs. MCOs must meet the 
same reporting and other MIA standards as HMOs. 
Financial solvency requirements can be modified for 
new MCOs. 

A major feature of the HealthChoice Program 
is the historic provider protection, which was built 
into the program to ensure their participation. 
Under HealthChoice, historic providers are 
ensured participation in at least one MCO. To be 
considered, a historic provider must meet the crite- 
ria set forth in the regulations. A provider who 
meets the criteria and has been unable to join any 
MCO will be assigned to an MCO by the 
Department. 

The SMHS provides specialty mental health 
services through a unique partnership of public and 
private agencies. The MHA administers this portion 
of the program together with 18 local core service 
agencies. CSAs are locally based government or pri- 
vate nonprofit entities that fund community-based 
mental health services on behalf of the State. Under 
the carve-out, CSAs continue their role as local gov- 
ernance entities and as gatekeepers for clients. As of 
July 1998, the MHA holds contracts with providers 
and, in conjunction with CSAs, oversees the provi- 
sion of services under those contracts. This arrange- 
ment ensures access to mental health services for 
persons with a range of mental health needs, includ- 
ing persons with serious mental illness (SMI). 
HealthChoice enrollees can be referred to the 
administrative services organization (ASO) for 
entry to the SMHS by their primary care provider 
or they can self-refer. 

A private, competitively procured behavioral 
health MCO has been hired as an ASO to provide 



extensive administrative and monitoring services. 
The ASO enrolls patients, coordinates benefits, pre- 
authorizes services, and provides other administra- 
tive services. The ASO does not oversee or manage 
the CSA functions. The MHA is responsible for 
overseeing all publicly funded mental health ser- 
vices. Monitoring CSA performance is the responsi- 
bility of the MHA, which contracts with each CSA. 
Providers need to fill out a provider application and 
have a contract with MHA in order to participate in 
the provider network. 

Financing of Plans 

Section ms - HealthChoice: The Medicaid agency 
makes capitated payments to MCOs for Medicaid 
physical and other special needs care, including 
substance abuse. MCOs are paid by the State 
through actuarially sound, risk-adjusted capitation 
rates, and most services are provided through the 
MCO. 

MCOs have stop loss insurance, by which an 
MCO enrollee whose inpatient hospital costs 
exceed $61,000 in the contract year shall be 
enrolled in the Stop Loss Case Management (SLM) 
Program for the remainder of the contract year. 
After enrollment in the SLM Program, the enrollee 
will remain in the MCO for all MCO-covered 
health care services. The State is liable for 90 per- 
cent of accrued inpatient hospital charges in excess 
of $61,000 and the MCO is responsible for the 
remaining 10 percent of charges. Patients will 
remain in the program for the duration of the con- 
tract year. The stop-loss case manager is responsible 
for developing a plan of care in consultation with 
the primary care provider at the MCO, the patient 
and the patient's family. If cost-effective, the SLK'l 
enrollees may receive an expanded set of benefits. 
The MCOs reassume full responsibility at the 
beginning of the following year. 

SMHS: Under the specialty mental health sys- 
tem, the Medicaid agency transferred funds for 
community mental health services to MHA. MHA 
combines Medicaid with its resources (State mental 
health grant funds, State hospital funds) and allo- 
cates funds to CSAs. Each CSA is allocated a glob- 
al budget based on historical rates of use. Specialty 
mental health services are not included in the MCO 
capitation rate. Localities are expected to remain 
within their budgets, and MHA does not pass risk 



July 31, 1998 



127 



on to them. CSAs that overspend can receive addi- 
tional funds from MHA if they can justify the need, 
although CSAs have an incentive to manage their 
funds efficiently because any unexpended funds in 1 
year are rolled over and added to the next year's 
resources for that jurisdiction. The CSAs, in turn, 
pay providers on a FFS basis, with the ASO actual- 
ly processing the claims and paying providers on 
behalf of the CSAs. The State decided upon using a 
regulated FFS system because this allowed MHA to 
abolish, for most services, the procurement process. 
The ASO is paid a set fee for the provision of its 
services. It has no incentives to deny care. 

Coordination Between Primary and 
Behavioral Health Care 



Section ms - HealthChoice: This program operates as 
a seamless system of care whereby MCOs may pro- 
vide some primary mental health and substance 
abuse services, but then refers to the public mental 
health system for other services. 

Consumer-Family Involvement 

Section ms - HealthChoice-. Unknown for implementa- 
tion stage. 

Future Plans 



Section ms - HealthChoice: On the basis of recom- 
mendations from the Long-Term Managed Care 
Advisory Committee, the State is developing pro- 
jects in four areas: 1 ) encouragement of individual 
long-term care planning,- 2) enhancement of home 
and community-based services,- 3) client directed 
care,- and 4) integrated care system projects. 

State Agency Administration 

The State's Medicaid authority is DHMH. The 
mental health authority, the MHA, and the sub- 
stance abuse authority, the Alcohol and Drug Abuse 
Administration, are housed separately under the 
DHMH. 

Welfare Reform 



Maryland's TANF program became effective 
December 9, 1996. The program denies TANF ben- 
efits to drug felons. Local Departments of Social 
Services (LDSS) do not test TANF applicants or 



recipients for drugs, but do administer a screen sim- 
ilar to MAST or CAGE at application and redeter- 
mination to TANF recipients who are adults or 
minor parents, if this screen indicates potential sub- 
stance abuse, or if the applicant or recipient 
acknowledges substance abuse, the LDSS notifies 
the appropriate MCO. Regardless of the results of 
the screen at the LDSS, the MCO must screen the 
TANF recipient for substance abuse because MCOs 
are required to screen all HealthChoice recipients 
for substance abuse. 

Maryland has a Welfare-to-Work plan, which is 
administered by the Department of Social Services 
in each jurisdiction. Although mental health and 
substance abuse treatment services are delivered by 
the Medicaid program, the LDSS can consider a 
TANF recipient receiving substance abuse treatment 
as participating in a work-related activity. 
Furthermore, Medicaid received a modification of 
its 1115 waiver that allowed it to expand the fol- 
lowing TCA services to TANF recipients who are 
adult (over age 21) parents: intermediate care facili- 
ties for addictions, therapeutic communities, and 
halfway houses. Medicaid is currently submitting 
another modification request that would extend 
substance abuse group home services to TCA par- 
ents under age 1 7, and therapeutic communities and 
halfway house services to parents age 18-20. 

County 

A Baltimore-based demonstration project was 
implemented prior to the waiver to provide single- 
stream -funded, partial capitated mental health ser- 
vices to no more than 300 Medicaid patients with 
SMI. 

Evaluation Findings 

Section iii5 - HealthChoice: The HealthChoice 
Program is monitored by the State based on 
specific quality, access, data, and performance 
standards for special needs populations: external 
quality medical record audits, information collect- 
ed from MCOs (encounter data. Health Employer 
Data Information Set (HEDIS) utilization, and 
outcome reports), external focused studies using 
medical records, provider and recipient hotlines, 
and the ombudsman program. At a later date, 
MCO report cards will be developed and 



128 



{SAMHSA} Managed Care Tracking System 



disseminated in coordination with the Health Care 
Access and Cost Commission. In October 1997, 
Maryland released the nation's first State-sponsored 
HMO report card. The information in the report 
card comes from HEDIS data collected by the 
HMOs and from a consumer satisfaction survey. 

Other Quantitative Data 

Currently, 73 percent of SMHS patients are 
Medicaid recipients and 27 percent are non- 
Medicaid, Less than 10 percent of costs are attrib- 
uted to the non-Medicaid population. 



July 31, 1998 129 



MASSACHUSETTS 



OVERVIEW 



With the implementation of a Section 1115 waiver in July 1997, Massachusetts entered a new phase 
of managed health care by expanding Medicaid eligibility and by continuing an integrated managed 
health care program under a new State benefit plan for Medicaid and non-Medicaid populations. Hie 
new waiver incorporates previous managed behavioral health care approaches established under a 
Section 1915(b) waiver. 

Under Massachusetts' integrated system, consumers have two options to receive physical health 
services: 1) they can join a health maintenance organization (HMO) from which they receive all 
health and mental health/substance abuse services, or 2) they can see one of the physicians partici- 
pating in the Primary Care Clinician Program (PCCP) as their primary health care provider and 
receive their mental health/substance abuse through the Behavioral Health Program (BHP), a mental 
health and substance abuse carve-out program. 

The carve-out is a capitated program with shared risk and is currently operated by a private 
behavioral health managed care organization (BHMCO). The BHMCO is responsible for adminis- 
tering and delivering all Medicaid carve-out services as well as acute inpatient/diversionary services 
and emergency services funded by the Department of Mental Health (DMH). DMH transferred 
funding for these services to the Division of Medical Assistance. 




Managed Care Programs for Behavioral Health Services 



|{ Medicaid Waivers 

Section 1115- MassHealth - integrated and carve-out:lwo choices: integrated HMO and PCCP with 
carve-out. 

II Medicaid Voluntary 
Not applicable. 

II Other Managed Care Programs 

Section 1115- MassHealth - integrated and carve-out: Provides physical health, mental health, and 
substance abuse services to working disabled adults, disabled children, and long-term unemployed 
individuals. 

Geographic Location Medicaid Substance Abuse Services 

Remaining Fee-For-Service 

Section ms - MassHealth: Statewide. :^;^^^^;:=^:^:^^^^=s^:^:^^^^^^ 

Outpatient (e.g., counseling, acupuncture detoxifi- 

Status of Programs cation, and special substance abuse services for 

pregnant women),- inpatient (e.g., hospital),- resi- 
Section ins -MassHealth: Submitted April 1, 1997,- i . , r , / ^. i r .. 

dentiai substance abuse (e.g., 24-hour, treestandmg 
approved June 30, 1997. Phase II managed care,- . , .r. . ^ 

, , , , , , , ^ r- A . community detoxihcation). 
approved by the Health Care rinancing Admini- 
stration,- approved by the state legislature July 1997. „.,.., ^^ - 

n , I . .^^^ , , r- Medicaid Mental Health Services 

beginning July 1, 1997, subsumed previous Section „ ••■-■-<>• 

° Remaining Fee-For-Service 

1 9 1 5(b) MassHealth Managed Care program and .^ :..= ;:.:..:...... :::.n:u:::::.:...:;:u.n;u.u,.:...:u...^ 

also expanded Medicaid eligibility (see Populations Inpatient (e.g., hospital, treatment for individuals 

Covered Section). under age 21),- outpatient (e.g., clinic services. 



July 31, 1998 



131 



psychological testing ),■ pharmacy (e.g., prescrip- 
tion drugs), psychiatric day treatment. 

Medicaid Substance Abuse Services in 
Managed Care Plan 



Section iiis - MassHealth: 

HMO: Outpatient (e.g., outpatient acupunc- 
ture detoxification, clinically intensive structured 
day/evening substance abuse services, outpatient 
addictions, counseling), inpatient (e.g., medical 
intervention for substance abuse, medical and social 
components of detoxification for pregnant women, 
acute detoxification, subacute); crisis (e.g., emer- 
gency services, short term crisis stabilization), resi- 
dential substance abuse (e.g., acute and short term). 

BHP carve-out (PCCP): Outpatient (e.g., out- 
patient acupuncture detoxification, clinically inten- 
sive structured day/evening substance abuse ser- 
vices, outpatient addictions, counseling), inpatient 
(e.g., medical intervention for substance abuse, 
medical and social components of detoxification for 
pregnant women, acute detoxification, subacute), 
crisis (e.g., emergency services, short-term crisis sta- 
bilization), residential substance abuse (e.g., acute 
and short term). 

Medicaid Mental Health Services in 
Managed Care Plan 

Section iiiS - MassHealth: 

HMO: Inpatient (e.g., Institution for Mental 
Diseases (IMD) services for individuals age 22-64, 
acute treatment for individuals under age 21),- crisis 
(e.g., emergency); outpatient (e.g., 12 outpatient 
visits automatically authorized, clinic services, non- 
physician providers, psychological testing, struc- 
tured outpatient programs); support (e.g., day and 
evening programs, targeted case management, 
intensive case management, family stabilization 
programs); pharmacy (e.g., drugs, management); 
residential (e.g., stabilization services, treatment for 
children and adolescents); rehabilitation (e.g., home 
care services, partial hospitalization). 

Although HMOs have always covered mental 
health and substance abuse services, new contracts 
as of July 1 include strengthened requirements for 
mental health/substance abuse services that mirror 
those of the PCCP carve-out and an increased man- 
agement of managed care organizations' behavioral 
health benefits. 



BHP can^e-out (PCCP): Inpatient (e.g., IMD 
services for individuals age 22-64, acute, treatment 
for individuals under age 21); crisis (e.g., emer- 
gency); outpatient (e.g., 12 outpatient visits auto- 
matically authorized, clinic services, nonphysician 
providers, psychological testing, structured outpa- 
tient programs); support (e.g., day and evening pro- 
grams, targeted case management, intensive case 
management, family stabilization programs); phar- 
macy (e.g., drugs, management); residential (e.g., 
stabilization services, treatment for children and 
adolescents); rehabilitation (e.g., home care ser- 
vices, partial hospitalization). 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Section ms - ^AassHealth: 
HMO: Not applicable. 
BHP carve-out (PCCP): Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Section iH5 - MassHealth: 

HMO: Not applicable. 

BHP carve-out (PCCP): Acute/diversionary (for 
uninsured) and emergency services. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section iH5 - MassHealth: None. 

Populations Covered Under Managed 
Behavioral Health 



Section ms - MassHealth: Adults and children 
mandatory: Aid to Families with Dependent 
Children/Hemporary Assistance for Needy Families 
(AFDC/TANF) (at or below 133 percent Federal 
poverty level (FPL)); Supplemental Security 
Income (SSI); pregnant women and children under 
1 year up to 200 percent FPL; families and long- 
term unemployed at or below 1 33 percent FPL. 

State Managed Care Program 
Administration 

Section iiis - MassHealth: MassHealth is administered 
by the Division of Medical Assistance (DMA). 



132 



{SAMHSA} Managed Care Tracking System 



HMO: Under the HMO option, DMAs goal is 
to make the plans more accountable and provide a 
more comprehensive package of services through 
capitated managed care. Behavioral health services 
are not carved out but instead remain part of the 
MCO's service package. 

DMA contracts with two private, not-for-profit 
provider-sponsored MCOs (prepaid health plans) 
and four private, not-for-profit HMOs. Except for 
one, all of the HMOs with whom the Division has 
contracted have some form of behavioral health 
contract with various types of providers including 
outpatient clinics and hospitals. 

The DMA has several responsibilities with 
respect to the administration of the contracts 
between the Division and the HMOs, including 
administration (e.g., contract monitoring, dispute 
resolution); performance evaluation (e.g., monitor- 
ing, evaluation, auditing),- enrollment, assignment, 
and disenrollment processes, and marketing. 

BHP carve-out (PCCP); in collaboration with 
DMH, DMA contracts with a private, for-profit 
BHMCO for the administration and service deliv- 
ery of the BHP carve-out. Under the terms of the 
contract, DMA is responsible for managing the con- 
tract with the BHMCO. DMA ensures that the 
BHMCO is in compliance with terms and condi- 
tions of the contract, reviews reports and other data, 
and provides direction on policy and procedures. 

The BHMCO is directly responsible for the 
management of the provider network, which 
includes the procurement of the network, network 
management, utilization review, quality manage- 
ment, community relations, and claims processing. 
The BHMCO holds the contracts with all service 
providers for mental health and substance abuse 
services. 

DMH transferred funding for the emergency 
services system as well as acute and diversionary 
mental health services to DMA. For all Medicaid 
members including members who are also DMH 
continuing care enrollees, the BHMCO is responsi- 
ble for acute inpatient, outpatient, diversionary, and 
emergency services. For DMH continuing care 
members who are not enrolled in Medicaid, the 
BHMCO provides acute inpatient/diversionary and 
emergency services. Eligibility for Medicaid is the 
responsibility of DMA, which uses financial criteria 
in its eligibility determination. Eligibility for DMH 



continuing care is DMH's responsibility, which uses 
clinical criteria in its eligibility determination. DMA 
and DMH have oversight responsibilities of the 
BHMCO, while the BHMCO is responsible for the 
management of the acute mental health and sub- 
stance abuse services delivered by the network 
providers. DMH retains responsibility for continu- 
ing care services. 

The BHMCO contracts on a fee-for-service 
basis with individual and group practices, inpatient 
facilities (e.g., hospitals, freestanding detoxification 
facilities), partial hospitalization programs, acute 
residential programs, and community mental health 
centers to deliver behavioral health services. 
Individual psychiatrists and psychologists may con- 
tract with the behavioral health vendor Social 
workers, licensed mental health counselors, and 
licensed substance abuse counselors must be a part 
of a group practice, or on staff with a hospital, com- 
munity (mental) health center, and acute residential 
program. 

For substance abuse, most traditional substance 
abuse safety net providers, defined as those con- 
tracting with the Bureau of Substance Abuse 
Services to provide the services identified above, 
are used for Medicaid reimbursed services if they 
desire. 

Financing of Plans 

Section ms - MassHealth: 

HMO: The HMO option under MassHealth is 
financed by Medicaid. HMOs receive capitation 
payments for physical health and all mental health 
and substance abuse services. Certain services are 
not included in the capitation payment and are 
reimbursed to providers. 

Under new contracts effective July 1, 1998 
HMOs will receive an enhanced capitation pay- 
ment for an expanded service package including 
alternative and diversionary services for mental 
health and prescription drugs (see Future Plans 
Section). TTie capitation rates are determined by 
taking into account 

1. The upper payment limit, 

2. The current experience of DMAs behavioral 
health vendor, and 

3. The bid submission of DMAs behavioral health 
vendor 



July 31, 1998 



133 



Payment for subcontractors is determined 
between the MCO and the subcontractor. There 
are no financial implications of the new HMO con- 
tracts for the BMP carve-out. 

BHP carve-out (PCCP): This program is 
financed through Medicaid and DMH dollars. 
DMH transferred its State funds for acute psychi- 
atric services to DMA. These funds are blended at 
the State level. DMH is able to transfer funds to 
DMA through an interservice agency agreement 
between DMA and DMH. 

The BHMCO receives three separate capitation 
payments based on eligibility groups. Three risk 
categories are used to determine the prepaid, per 
capita monthly payments: the disabled group (SSI 
and SSI Medical Assistance only), the nondisabled 
groups (primarily AFDC, refugees, and Medical 
Assistance clients under age 21), and long-term 
unemployed. 

it is a shared risk/gain arrangement between 
DMA and the BHMCO for over/underspending 
within a set of financial limits. There is a 45 
(BHMCO )/55 (DMA) percent split between DMA 
and the BHMCO on savings or loss with $20 mil- 
lion on the BHMCO profit and $5 million on the 
BHMCO loss. 

The providers are not at risk and are paid on a 
fee-for-service basis by the BHMCO. There were 
no incentives built into the capitation rates for the 
BHMCO, however, there is a separate incentive 
(bonus/penalty) structure tied to a series of "perfor- 
mance standards." Performance standards are initia- 
tives that reflect the priorities of DMA and the 
BHMCO. All performance standards have measur- 
able goals that the BHMCO is required to meet. 
Depending upon the nature of the performance 
standard, the BHMCO has the opportunity to earn 
a financial bonus or can incur a financial penalty. 

Coordination Between Primary and 
Behavioral Health Care 

Section ms - MassHealth: The BHMCO and the 
PCCP have established a communication protocol 
between the BHMCO's network providers and the 
PCCP providers. Also, one of the performance stan- 
dards requires hospitals to notify primary care clin- 
icians when MassHealth members who are disabled 
are receiving inpatient psychiatric treatment. 



Consumer-Family Involvement 

Section iH5 - MassHealth: Phase I of the managed 
care program had limited consumer involvement in 
the design of the program. Consumers participated 
in the selection process of the new BHMCO. 
Through the consumer and the family councils, 
consumers and family members are able to advo- 
cate for their needs and voice their input in pro- 
gram design and implementation. Currently, sever- 
al community and family councils meet regularly 
with the carve-out and the Division and provide 
input on MCO policies, practices, and administra- 
tion. The HMOs will be required to participate in 
consumer and family advisory councils sponsored 
by the BHMCO. in addition, the HMOs are 
required to design and implement a plan to coordi- 
nate and facilitate members' access to behavioral 
health programs related to peer and self-group ser- 
vices. The HMOs are also required to develop and 
maintain an up-to-date directory of peer and self- 
help groups by geographic locations. 

Future Plans 

Section iH5 MassHealth: 

HMO: In an effort to improve the quality of its 
Medicaid managed care program and make HMO 
enrollment a more attractive option to its medical 
assistance population, Massachusetts is planning to 
enter into longer, more intensive partnerships with 
fewer health plans. Officials hope the changes will 
lead more medical assistance recipients in mandato- 
ry managed care to choose HMOs rather than the 
PCCP. More specifically, Medicaid is currently in 
negotiations with HMOs for 5-year contracts effec- 
tive July 1, 1998. HMOs will have to dedicate a full- 
time equivalent (FTE) MassHealth Director and 
FTE quality and behavioral health managers. 
Behavioral services will not be carved out but 
instead be part of the MCOs' service package. The 
goal is to make plans more accountable and provide 
a more comprehensive package of services through 
capitated managed care. 

BHP carve-out (PCCP): Currently, none, how- 
ever, the current BHMCO contract has been 
extended through June 30, 2000. 



134 



{SAMHSA} Managed Care Tracking System 



State Agency Administration 



Massachusetts' Executive Office of Health and 
Human Services houses the DMA (Medicaid), the 
DMH, and the Department of Public Health. The 
Bureau of Substance Abuse Services is under the 
Department of Public Health. 

Welfare Refornn 

• Massachusetts's Welfare to Work (WtW) Grant 
was submitted to the U.S. Department of Labor 
(DOL) on January 5, 1998, and approved 
February 19, 1998. it will be administered by 
the DOL and Workforce Division. Matching 
funds will come 100 percent from the State in 
the form of cash. TTie expenditure of 1 5 percent 
of the State's monies is at the Governor's discre- 
tion and may be used for management informa- 
tion systems hardware and software or any 
other service as provided by the regulation. 
Coordination mechanisms between local WtW 
entities and local TANF agencies require formal 
linkages. TTie State steering committee is made 
up of representatives from Departments of 
Transitional Assistance, Education, the 
Executive Offices of Health and Human 
Services, Administration and Finance and 
Transportation, the Division of Employment 
and Training, Corporation for Business, Work, 
and Leaning (the Administrative Agency), and 
the Department of Labor and Work Force 
Development (the lead State agency). Activities 
at the local level are coordinated by the 15 
Regional Employment Boards. TTie Depart- 
ments of Transitional Assistance and 
Employment and Training have a member on 
each board. 

Outcome measures include employment, 
retention, and increased earnings. The numbers 
entering employment, final completions, and 
interim benchmarks are also requirements of 
the plan. To date, there have been no regula- 
tions on which to set the interim benchmarks. 
Although the Federal legislation allows for the 
inclusion of mental health and/or substance 
abuse treatments in the WtW plan, the decision 
to provide these services will be made at the 
local level by the individual Regional 
Employment Boards. 



• In Massachusetts' welfare reform plan, drug 
testing is not mandatory and those TANF recip- 
ients who are convicted of drug felonies will be 
denied benefits. There are no provisions in the 
TANF WtW plan to provide services specifical- 
ly for public sector behavioral health clients. 

County 

Not applicable. 

Evaluation Findings 

Section ms - MassHealth: Independent follow-up sur- 
veys conducted by researchers at Suffolk University 
for years 2-5 of the carve-out (under Phase 1) indi- 
cate that more providers than expected were doing 
well financially under the managed care program for 
mental health and substance abuse. In fact, in year 5 
of the carve-out, 40 percent of the providers report- 
ed they were doing financially better than the prior 
year. However, outpatient providers and communi- 
ty mental health centers had to make special 
accommodations and change their organizations to 
participate effectively in managed care. In year 4 of 
the program. 



• 51 percent increased in size,- 

• 70 percent expanded their variety of services,- 

• 34 percent greatly added or strengthened their 
Total Quality Improvement/Total Quality 
Management program,- 

• 59 percent expanded, greatly improved, or 
made many changes to their management infor- 
mation system,- 

• 20 percent increased their collection of data on 
utilization, expenditures, and outcomes, 

• 80 percent devoted more staff hours each week 
to paperwork, utilization review, and Total 
Quality Improvement, as compared with clini- 
cal care, 

• 50 percent devoted more time to training and 
supervision,- and 

• Most moved very slowly toward capitation, on 
average, 80 percent of current contracts were 
fee-for-service and 20 percent were capitated or 
partially capitated. 

Growth continued in year 5, though at a slow- 
er rate. For example, 22 percent said they increased 
their size in year 5 (compared with 51 percent m 



July 31, 1998 



135 



year 4). Only 42 percent expanded their continuum 
(variety of services) in year 5 (compared with 70 
percent in year 4). However, more providers 
strengthened Total Quahty Improvement/Total 
Quality Management in year 5 (68 percent), com- 
pared with a year earlier. 

Providers were essentially evenly split on over- 
all financial strength, with one-third financially bet- 
ter off, one-third about the same, and one-third 
worse off by year 4 than they were before managed 
care initiative. In year 5, more community providers 
(40 percent) reported doing better and fewer (27 
percent) reported doing worse. Providers that did 
worse reported the following: 

• Increased costs associated with seeing more 
severely ill patients and providing more inten- 
sive treatment, 

• Shorter lengths of stay, which led to increased 
case turnaround and higher costs associated 
with this pattern of care,- 

• Low reimbursement rates, and 

• High administrative costs, poor cash flow, and 
unreimbursed care as result of the MCO's prior 
approval and billing processes. 



Another evaluation published in 1994 by the 
Heller School at Brandeis University found that, 
while saving $47 million in Medicaid funds, BHP 
increased the Medicaid penetration rate from 21.3 
to 22.3 percent. Recidivism rates and the use of 
inpatient hospitals for substance abuse treatment 
were reduced, even though the range of 24-hour 
services for both mental health and substance abuse 
was increased to include freestanding detoxification 
centers, residential treatment facilities, and diver- 
sionary beds. Acupuncture as a detoxification strat- 
egy, clinic treatment and methadone dosing, and 
counseling all were expanded for persons with 
addictive disorders. The program also received a 
generally positive evaluation from providers regard- 
ing the quality of managed care staff treatment- 
related decisions. 



Other Quantitative Data 

Not applicable. 



136 



{SAMHSA} Managed Care Tracking System 



MICH IG AN 



OVERVIEW 

Michigan's statewide managed care strategy encompasses five managed care plans, including three 
comprehensive health plans and two stand-alones for specialty mental health, substance abuse, and 
developmental disability services and supports. Under a 1915(b) waiver, the comprehensive health 
program for low-income citizens is now operating as a pilot in a five county areas with mandatory 
enrollment. Under this program, qualified health plans (QHPs) manage primary care services. All 
Medicaid mental health and substance abuse services are part of the stand-alone. 

In addition to the waiver program, two voluntary managed care plans that include some mental 
health services are operating in counties not covered by the pilot. However, once the comprehensive 
health program has been phased in statewide, the voluntary health maintenance organization 
(HMO) and primary care case management (PCCM) programs will be phased out. 

Managed Care Programs for Behavioral Health Services 

I Medicaid Waivers i 

I Section 1915(b) - Comprehensive Health Plan - Integrated: Provides physical health as well as basic men- Ij 

I tal health services. i 

11 
II 

Section 1915(b) - Managed Specialty Services Program (MSSP) - behavioral health stand-alone: Provides j 
mental health and substance abuse services. Ij 

I Section 1915(a) - Michigan Interagency Family Preservation Initiative (MIFPI) - integrated:Vbluntary, capitat- | 
ed program that provides Medicaid covered and other noncovered behavioral health services for | 

severely impaired multisystem children and adolescents. | 

Medicaid Voluntary 

Voluntary HMO - integrated: Physical health program that provides limited mental health services to 
p Medicaid recipients. jj 

^ Other Managed Care Programs 

Section 1915(b) - Managed Specialty Services Program (MSSP) - behavioral health stand-alone: Non- | 

Medicaid populations are wrapped into the waiverThe funding streams remain separate but this is 
invisible to the client. I 




Geographic Location Status of Programs 



Section i9i5(h) - Comprehensive Health Plan: Statewide. Section i9{5(h) - Comprehensive Health Plan: Submitted 

Section i9i5(b] -MSSP: Statewide. September 1996, approved May 1997, implement- 

Sectiow 1915(«} -A4/fP/. Two demonstration sites ed October 1, 1997, in five counties,- statewide 

(Livingston and Van Buren Counties), 50 children implementation January 1, 1998. 

are enrolled. Section i9i5[b) -MSSP: Submitted waiver June 

Voluntary HMO: Operating in 14 counties 1997, approved June 26, 1998,- implementation to 

(approximately 300,000 people are currently begin October 1998 pending the Health Care 

enrolled). Finance Administration (HCFA) approval. 

Section i9i5[a) - MlFPl: Implemented. 
Voluntary HMO: Approved and implemented 
January 1983. 



July 31, 1998 137 



Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Detoxification (acute),- pharmacy,- laboratory. 

Medicaid Mental Health Services 
Remaining Fee-For^Service 



Inpatient (incorporates inpatient psychiatric ser- 
vices for individuals under age 21), outpatient (e.g., 
partial hospitalization, physician services, clinic ser- 
vices),- rehabilitation,- support (e.g., targeted case 
management, personal care services). 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section i9i5[b] - Comprehensive Health Plan: None. 

Section i9i5[b)-MSSP: Under the MSSP, the fol- 
lowing substance abuse services will be covered; 

• Assessment, diagnosis, patient placement, and 
referral; 

• Outpatient treatment (including individual, 
family, and group therapy),- 

• Intensive outpatient treatment,- and 

• Federal drug administration approved pharma- 
cological supports. 

Under the MSSP, the following substance abuse 
services will be allowable (out of savings): 

• Residential (subacute) detoxification, and 

• Residential services in an Institution for Mental 
Diseases (IMD) or non-IMD. 

Section I9i5[a] - MIFPL Outpatient (e.g., coun- 
seling, group, and/or family counseling, intensive 
services). 

Voluntary HMO: Not applicable. 

Medicaid Mental Health Services in 
Managed Care Plan 

Section ipijffc] - Comprehensive Health Plan: Outpatient 
(e.g., limited to 20 visits). 

Section i9i5[h) - MSSP: Crisis (e.g., emergency 
services), inpatient, outpatient, residential, support, 
rehabilitation, transportation, pharmacy. 

Section i9i5(a] - MIFPL Unknown. 

Voluntary HMO: Outpatient (e.g., responsible 
for up to 20 outpatient mental health visits for recip- 
ients who need short-term ambulatory care). 



Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Section i9i5[b] - MSSP: Substance abuse services 
include the following: 

• Room and board,- 

• Residential (allowed for Medicaid recipients out 
of Medicaid funds and/or other public funds), 

• Subacute detoxification (allowed for Medicaid 
recipients out of Medicaid funds and/or other 
public funds); and 

• Services required of women's specialty pro- 
grams under the Federal Substance Abuse 
Prevention and Treatment Block Grant, includ- 
ing case management, transportation, and child 
care. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 



Section i9i5[h] -MSSP: Crisis (e.g., emergency ser- 
vices), inpatient, outpatient, residential, support, 
rehabilitation, transportation, pharmacy. 

Substance Abuse Prevention and Mental 
Health Promotion In Managed Care Plan 



Section i9i5(b] - Comprehensive Health Plan: None. 

Section i9i5[b] - MSSP: Information and educa- 
tion, direct service models, population-based prima- 
ry prevention. 

Section i9i5(a) - MIFPL Early and periodic 
screening, diagnosis, and treatment. 

Voluntary HMO: None. 

Populations Covered Under Managed 
Behavioral Health 



Section i9i5[h] - Comprehensive Health Plan: Adults and 
children mandatory: Aid to Families with De- 
pendent Children/Temporary Assistance for Needy 
Families (AFDC/TANF), Supplemental Security 
Income (SSI), optional expansion pregnant women 
and children. 

Section i9i5[b]: MSSP: Adults mandatory: 
AFDC/TANF, SSI, dually eligible (Medicare/ 
Medicaid), uninsured, underinsured. For the unin- 
sured and underinsured, a "means test" is used to 
determine eligibility. The test is a clinical test: Does 
the person meet one of the priority populations def- 
initions of the State Mental Health Code (serious 



138 



{SAMHSA} Managed Care Tracking System 



mental illness or severe emotional disturbance) or 
do they meet Federal block grant priorities? 

Section i9i5[a] - MIFPL Voluntary: children and 
adolescents. 

Voluntary HMO: Adults and children voluntary: 
AFDCATANF; SSI. 



State Managed Care Program 
Administration 



Section i9i5(b] - Comprehensive Health Plan: Medicaid 
contracts directly with HMOs. QF4Ps are the 
State designation for managed care organizations 
(MCOs) that provide or arrange for the delivery of 
comprehensive health care to Medicaid recipients 
in exchange for a fixed prepaid sum or per-member 
per-month (PMPM) capitation rate without regard 
to the extent or kind of service,- the QHPs happen 
to be all HMOs currently,- however, this wording in 
the request for proposals was an attempt to broad- 
en the market and include physicians/hospital 
organizations. 

Medicaid contracts with the QHPs on a com- 
petitive bid basis. An enrollment broker, under con- 
tract to Medicaid, informs beneficiaries of the 
choice of QHPs in their area and signs them up for 
a health plan. Medicaid pays the plans, collects 
data, conducts quality assurance assessments, and 
conducts beneficiary hearings. The QHPs are 
responsible for provider network, provision of ser- 
vices, and third-party liability determination and 
payment. The nature of each panel is determined by 
the QHP,- many are closed-panel arrangements. 
The QHPs are almost exclusively private, not-for- 
profit entities (one is composed of a federally qual- 
ified health center and another is a for-profit 
HMO). HMOs are responsible for a limited (20 vis- 
its) behavioral health benefit and they do subcon- 
tract for the management/provision of that ser- 
vice/benefit. 

Section i9i5[b] - MSSP: Programs will be admin- 
istered by the Department of Community Health 
(DCH), Mental Health, and Substance Abuse 
Service Division. DCH will set up a system in 
which community mental health boards will admin- 
ister Medicaid and state-funded indigent care pro- 
grams. The Division will sole-source to 49 commu- 
nity mental health service programs (CMHSPs) 
that have contracts with DCH. 



There are 49 CMHSPs that cover all 83 counties 
in the state. All CMHSPs are governmental entities 
and are sponsored by county government. CMHSPs 
are defined in the State mental health code as fol- 
lows: '"community mental health services program' 
means a program operated under chapter 2 as a coun- 
ty community mental health agency, a community 
mental health authority, or a community mental 
health organization." TTie types of CMHSPs are 

• County community mental health agency: An 
official county or multicounty agency created 
under Section 210 that operates as a CMHSP 
and that has not elected to become a communi- 
ty mental health authority Section 205 or a 
community mental health organization under 
Act No. 7 of the Public Acts of the Extra 
Session of 1967,- 

• Community mental health authority: A separate 
legal public governmental entity created under 
Section 205 to operate as a CMHSP,- and 

• Community mental health organization: A 
CMHSP that is organized under the Urban 
Cooperation Act of 1967, Act No. 7 of the 
Public Acts of the Extra Session of 1967, being 
sections 124.501 to 124.512 of the Michigan 
compiled laws. 

These entities are governed by a 12-member 
board, initially selected by the County 
Commission. At least one-third of the membership 
of the board must be primary consumers and family 
members of consumers. 

CMHSPs are managers of the program and 
responsible for selecting providers. Many CMHSPs 
contract all or part of their services. For mental 
health, CMHSPs contract with more than 30 
human service organizations (nonprofit agencies) 
that banded together to form a behavioral health 
network that will provide treatment services to 
employer group plans, MCOs, and Medicaid 
clients. For substance abuse, CMHSPs are required 
to subcontract with regional substance abuse (SA) 
coordinating agencies for the management of SA 
benefits. 

There are 15 regional SA coordinating agen- 
cies. Two are part of CMHSPs, seven are part of 
local public health departments, three are quasi- 
governmental agencies formed under the Urban 
Cooperation Act, and three are private not-for-prof- 
it freestanding entities. 



July 31, 1998 



139 



The administrative responsibilities of the SA 
coordinating agencies under the MSSP will include 
ensuring access, service authorization and utiliza- 
tion management, provider netu'ork development, 
customer services, grievance procedures, care coor- 
dination, data collection and reporting, quality 
assurance and performance indicators, and fiscal 
management. Coordinating agencies do not provide 
treatment services (some do have waivers to per- 
form assessment services). 

Coordinating agencies subcontract for treat- 
ment services with providers licensed by the State's 
Department of Consumer and Industry Services. To 
receive Medicaid and other public funding adminis- 
tered by DCH, the providers also must be accredit- 
ed by one of five national accrediting bodies. In 
Michigan, there are approximately 795 licensed 
substance abuse treatment programs. Of these, 
approximately 394 are currently enrolled as 
Medicaid providers. Of the latter group, 275 were 
funded at the beginning of fiscal year 1998 by coor- 
dinating agencies to serve the non-Medicaid indi- 
gent population. When the MSSP begins, coordi- 
nating agencies will be required to contract, for at 
least the first 6 months, with existing enrolled 
Medicaid substance abuse providers who can meet 
the coordinating agencies' contract terms. 
Additional providers may be added to a coordinat- 
ing agency's Medicaid managed care panel. 

Section {915(a) - MIFPL The contract in the two 
pilot sites is with CMHSPs who function as the 
fiduciary agents for the project. Other organiza- 
tions (social services, juvenile court, schools) share 
actual governance and pool some of their funds with 
the CMHSP. The steering committee (interagency 
group) determines the provider network. 

Voluntary HMO: Under a voluntary Medicaid 
HMO program, Michigan's Medicaid agency con- 
tracts with 12 private, not-for-profit HMOs. 
Similarly, as under the comprehensive health plan, 
an enrollment broker, under contract to Medicaid, 
informs beneficiaries of the choice of HMOs in 
their area and signs them up for a health plan. 
Medicaid pays the plans, collects data, conducts 
quality assurance assessments, and conducts benefi- 
ciary hearings. The HMOs are responsible for 
provider network, provisions of services, and third- 
party liability determination and payment. The 
nature of each panel is determined by the QHP,- 



many are closed-panel arrangements. HMOs are 
responsible for a limited (20 visits) behavioral 
health benefit and they do subcontract for the man- 
agement/provision of that service/benefit. 

Financing of Plans 



Section I9i5[b] - Comprehensive Health Plan: This pro- 
gram is financed through Medicaid. QHPs are paid 
a fixed prepaid sum or PMPM capitation rate. 

Capitation rates were competitively bid within 
a bid corridor established by the State. Savings were 
assumed and built into the rate. If profits are gener- 
ated, they accrue to the QHP. There are general 
provisions on profits in the State HMO law. 

QHPs are either at full risk (licensed plans) or 
shared risk (unlicensed plans). The State offers no 
stop-loss coverage, it is up to the individual health 
plans to obtain some form of reinsurance. 

Section I9i5(b] - MSSP: This program will con- 
solidate public funding for mental health and sub- 
stance abuse services (e.g., Medicaid, State general 
funds, substance abuse block grant dollars) at the 
local level. Three phases of development have been 
proposed for the carve-out. Phase 1 includes a carve- 
out to existing public entities and stresses function- 
al consolidation of funding streams (e.g., same local 
entity will receive capitated Medicaid funds as well 
as indigent care dollars), affiliation of various layers 
of governmental administration, and measurement 
of performance and preservation of public systems 
of care. 

Phase II calls for opening of the carve-out for 
bid and withdrawing the sole-source arrangement 
with pubic sector agencies. In phase III, the depart- 
ment will explore various models that integrate 
physical and behavioral health care management 
and service delivery. A key element in this approach 
is the prepayment, risk/award arrangement with the 
contractor, which encourages innovation, individu- 
alized care, and greater accountability. 

The ultimate goal of the department is to pro- 
mote coordinated community health care systems. 

CMHSPs will receive several types of pay- 
ments: 

• During Phase I, the department will prepay 
CMHSPs on a capitated basis for mental 
health/substance abuse and developmental dis- 
ability services. CMHSPs will subcontract with 



140 



{SAMHSA} Managed Care Tracking System 



regional SA coordinating agencies for manage- 
ment of Medicaid substance abuse services. 

• Two separate capitation rates for mental 
health/substance abuse and developmental dis- 
ability services under Medicaid. CMHSPs and 
DCH will share Medicaid costs for services 
over the established threshold and share cost 
savings. Capitation rates for mental health/sub- 
stance abuse will be calculated using per capita 
methodology within a six-rate-cell structure. 
For developmental disabilities, capitation rates 
will be calculated using a per-eligible method- 
ology within a four-rate structure. Those 
CMHSPs serving a larger population base 
and/or those CMHSPs with a more extensive 
and stable claims history for Medicaid covered 
services will be favorably rated in terms of per- 
centage of premiums that must be set aside as 
dedicated contingency reserve fund. 

• State general fund authorization for non- 
Medicaid eligible needing mental health ser- 
vices. CMHSPs will also receive a State gener- 
al fund authorization to provide services to eli- 
gible service area recipients not covered by 
Medicaid. 

• The Department will preserve a dedicated fund- 
ing stream of State appropriations and Federal 
block, grant allotments for substance abuse 
treatment and prevention services that will be 
distributed to existing regional Coordinating 
Agencies that are statutorily designated recipi- 
ents of these funds. 

The Department's proposed model would allow 
CMHSPs to share the savings of cost-effective care 
and permit them to reinvest these savings into the 
delivery system. Many CMHSPs do not have a suf- 
ficient population base to allow them to reap the full 
benefits of a managed care system. The Department 
strongly recommends in these cases a formal merg- 
er of CMHSPs as the preferred vehicle for consoli- 
dation. This, however, will be the county's preroga- 
tive. The Department will also permit smaller 
CMHSPs to participate in the prepaid plan if they 
come together into what the department is charac- 
terizing as Regional Management Networks to 
jointly administer the managed care plan. 

Section i9i5[a] - MIFPL Programs under this ini- 
tiative are capitated and at risk. Funds for the capi- 



tation amount vary depending upon recipient eligi- 
bility for various entitlement programs but are typi- 
cally provided through Medicaid, Title IV funds, 
and local contributions. Funds are blended at the 
State level depending upon recipient eligibility. 
Capitation rates were determined by an assessment 
of historical costs for serving the target population 
and assessment of historic eligibility trends (for 
Medicaid, IV-E) for these recipients. It is a full-risk 
model, savings must be reinvested in program ser- 
vices. 

Voluntary HMO: Medicaid dollars fund this pro- 
gram. HMOs are capitated and at risk. They may 
elect to subcapitate providers. Capitation rates are 
based on historical costs of the fee-for-service pop- 
ulation minus a percentage reduction (1-10 percent 
depending on the region of the State). All savings 
are retained by HMO and there is no reinvestment 
requirement. 

Coordination Between Primary and 
Behavioral Health Care 



Section i9i5(b] - Comprehensive Health Plan: QHPs and 
CMHSPs are required by contract to have written 
agreements stipulating referral processes, clinical 
coordination, information exchange, and dispute 
resolution processes. 

Section i9i5(h) - MSSP: CMHSPs will need to 
closely manage both their own (direcdy operated) 
services and those provided under contract 
(provider network) as an integrated and organized 
system of care. The care management responsibili- 
ties (access, services, quality) assumed by the Board, 
combined with the risk arrangements in the con- 
tract, will necessitate a new level of coordination 
and accountability between Board programs, and 
between the Board and its external suppliers. 
Section i9i5(a] - MIFPh Both pilot sites have a 
multipurpose collaborative body, which is the 
local vehicle for coordinating services. 
Voluntary HMO: Voluntary HMOs (just like 
QHPs) have limited mental health responsibilities 
(20 outpatient visits). They must have an agreement 
with CMHSPs for service coordination of other 
mental health services. 



July 31, 1998 



141 



Consumei^Family Involvement 



Section i9i5[b) - Comprehensive Health Plan: Consumers 
and family groups were apprised of plan design but 
involvement was limited because of procurement 
issues. Stakeholder meetings and informational 
campaigns were used to solicit ongoing input from 
these groups. Consumers were required to comprise 
one-third of the membership of the QHP governing 
body. Furthermore, DCH has ongoing involvement 
with advocate groups. Consumers also participate in 
Readiness Review site visits and in communications 
to beneficiaries. 

Section i9i5[h] - MSSP: Phase 111 will introduce 
competitive procurement process, with consumers 
and family members participating in contractor 
selection. 

Section i9i5[a] - MIFPL Consumers and families 
were on the planning team and are part of the mul- 
tipurpose collaborative body that coordinates ser- 
vices at the local level. 

Voluntary HMO. Consumers and families pro- 
vided input in the design and implementation of 
this program through a Medicaid Advisory Council. 

Future Plans 

Section i9i5(b] - Comprehensive Health Plan: Statewide 
expansion begins August 1998. Bids for regions of 
the State have been received and QHPs have been 
selected. Readiness reviews are being conducted. 

Future plans under this program include con- 
tract changes to conform with the Federal Balanced 
Budget Act and implementation issues. The focus 
will be on reporting and performance outcomes. 

Section i9i5[h] -MSSP: There will be three phas- 
es of implementation (see Financing Section). 

Section i 9 i 5(a] - MIFPL Directors of State health, 
welfare, and human service departments, are exam- 
ining the issue of how to encourage more pooled 
funding arrangements within local Child and Family 
Service Systems (the various health, welfare, educa- 
tion, juvenile justice, mental health, and substance 
abuse entities that provide services to children) by 
developing mechanisms for these agencies to share 
risks (rather than shift risk), distribute rewards (e.g., 
reduction in the use of highly restrictive service set- 
tings), and improve service outcomes. 

Voluntary HMO: Physical health services of the 
voluntary HMO program will be subsumed by the 



comprehensive health plan (QHPs) program. 
Mental health and substance abuse services for all 
Medicaid recipients, regardless of health plan 
enrollment, will be subsumed by the MSSP. 

State Agency Administration 

The Department of Community Health oversees all 
three agencies: Medicaid, Mental Health/Substance 
Abuse and Developmental Disability Services, and 
the Public Health Agency. The Medical Services 
Administration, Mental Health/Substance Abuse 
Services Administration (which includes 
Developmental Disabilities), and the Public Health 
Agency serve as these agencies, respectively. 

Welfare Reform 

• Substance abuse treatment for public assistance 
clients: Substance abuse treatment services con- 
tinue to be available for the public assistance 
clients. If the client is enrolled in Medicaid, ser- 
vices must be accessed through the Medicaid 
program. Otherwise, the client may be eligible 
for services funded by Substance Abuse 
Prevention and Treatment block grant funds 
and state general funds, which the Center for 
Substance Abuse Services administers. Family 
Independence Agency (FIA) clients with sub- 
stance abuse problems are considered to have 
special needs and are required to be enrolled in 
either Michigan Opportunity and Skills 
Training (MOST) or WORK FIRST as part of 
their treatment plan. For those TANF eligibles 
convicted of a drug felony, benefits must be 
paid through a third-party payor contingent 
upon the individual meeting parole require- 
ments. 

The State is monitoring the impact on SSI 
recipients under the Contract with America 
Advancement Act, which terminated SSI for 
those individuals deemed disabled due to any 
alcohol or drug addiction. The State contracted 
with Wayne State University to monitor the 
impact of the termination of substance abuse as 
a qualifying disability for SSI. Some data have 
been collected but no findings have been made 
and the Department has not issued any reports 
yet. The contract has been extended to 
September 30, 1998. 



142 



{SAMHSA} Managed Care Tracking System 



The regional assessment centers in 
Michigan are using the American Society of 
Addiction Medicine patient placement criteria, 
the Addiction Security index for adults, and the 
Adolescent Drug Abuse Diagnosis instrument 
for adolescents for Medicaid clients seeking 
substance abuse treatment services. 

Michigan's Welfare to Work (WtW) Grant was 
submitted to the U.S. Department of Labor on 
December 1 1, 1997, and approved on January 
29, 1998. Michigan Jobs Commission Vk'ill 
serve as the administering agency of the grant. 
One hundred percent of State funds will serve 
as the matching fund source. The intended use 
of the 15 percent State project funds will be 
determined based on locally identified needs 
or distributed through formula. The substate 
allocation formula for 85 percent of the funds 
will be split 50/50 between the poor and TANF 
eligibles. Coordination between WtW entities 
and local TANF agencies will occur through 
the Jobs Commission, which reviews and 
approves local plans. Referral for substance 
abuse treatment is made to SA coordinating 
agencies and their assessment agencies for 
services. Outcome measures include place- 



ment and earnings in unsubsidized employ- 
ment and increase in child support payments. 
The ultimate goal of Michigan's WtW grant is 
to develop a noncustodial parent program. 



County 

Not applicable. 



Evaluation Findings 



Section {9 i 5(b) - Comprehensive Health Plan: Evaluations 
on access, quality, and cost are currently ongoing. 
Mandatory evaluations are being conducted by the 
legislature in addition to HCFA-required evalua- 
tions. Access is assessed via quarterly and annual 
reports,- cost via monthly, quarterly, and annual 
reports. Quality improvement reports and 
encounter data systems are under way. 

Section i9 15(b) - MSSP: Mandatory evaluations 
are required under the waiver. A contractor has been 
selected and the design and evaluation process is 
being developed. 

Other Quantitative Data 



Not applicable. 



July 31, 1998 



143 



MINN ESOTA 



OVERVIEW 



The State currently has four physical health managed care programs that include behavioral health 
services and one that is specific to chemical dependency. Managed care programs in Minnesota are 
population based. Most programs focus on primary and acute care services, although one long-term 
care demonstration is now operating to serve dually eligible individuals. The predominant model for 
managed care in Minnesota has been the health maintenance organization (HMO) model, a concept 
pioneered in the State over 10 years ago. 

It is the State's intention to eventually integrate the full range of services covered under all five 
programs into a comprehensive basic benefit package. However, new programs are also being devel- 
oped to begin early in 1999 to include children with severe emotional disorders (SED) and adults 
with severe and persistent mental illness. 

Managed Care Programs for Behavioral Health Services 

Medicaid Waivers 

Section 1115- Prepaid Medical Assistance Program (PMAP) - general health - integrated: Includes physical 

health, mental health, and chemical dependency for Medicaid recipients. 

Section 1115- Minnesota Senior HeallJi Options (MSHO) - general health - integrated: Voluntary pro- 
gram for Medicaid and Medicare eligible individuals over age 65. 

Section 1915(b) - Consolidated Chemical Dependency Treatment Fund (CCDTF) - substance abuse stand- 
alone: Specific to chemical dependency services. Covers substance abuse services on a fee-for-service 
(FFS) basis for Medicaid and general assistance recipients and others who meet income criteria. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

Minnesota Care - Medicaid portion - integrated: Includes all Medicaid covered services for pregnant 

woman and children up to 275 percent of Federal poverty level (FPL). This program is for uninsured 

working poor and includes sliding scale premiums. General assistance non-Medlcaid portion: Includes 

acute care medical services and limited mental health and chemical dependency for childless adults 

up to 1 75 percent of FPL. This program is for uninsured working poor and Includes sliding scale 

premiums. 

General Assistance Medical Care Managed Care - general assistance program - integrated: Similar to 
PMAP, but applies to the 100 percent State-funded program for certain low-income adults who are 
not eligible for Medicaid and includes limited mental health and substance abuse services. 




Geographic Location 

Section iiis - PMAP: Currently in the following Scott, Sherburne, Stearns, Swift, Washington, and 

counties: Anoka, Becker, Benton, Carlton, Carver, Wright. Plans to be statewide by 1999. 
Chisago, Clay, Cook, Dakota, Faribault, Hennepin, MSHO: Implemented in seven counties: 

Isanti, Itasca, Kandiyohi, Koochiching, Lake, Hennepin, Ramsey, Anoka, Dakota, Carver, Scott, 

Mahnomen, Martin, Norman, Ramsey, St. Louis, and Washington. 



July 31, 1998 I4S 



Section I9i5[b] - CCDTF: Statewide. 

MinnesotaCarC: Statewide. 

General Assistance Medical Care Managed Care: 
Currendy in the following counties: Anoka, Becker, 
Benton, Cadton, Carver, Chisago, Clay, Cook, 
Dakota, Faribault, Hennepin, Isanti, Itasca, 
Kandiyohi, Koochiching, Lake, Mahnomen, 
Martin, Norman, Ramsey, St. Louis, Scott, 
Sherburne, Stearns, Swift, Washington, and Wright. 
Plans to be statewide by 1999. 

Status of Programs 



Section iiis - PMAP: Submitted July 1994,- approved 
April 1995; implemented July 1995,- expansion 
approved. 

Section ms - MSHO: Implemented February 
1997. Minnesota originally submitted a waiver with 
a concept similar to the current MSHO demonstra- 
tion in 1991. This proposal was rejected in 1992, 
but the Health Care Finance Administration 
(HCFA) worked with Minnesota to support a plan- 
ning grant from the Robert Wood Johnson 
Foundation that was granted in the fall of 1992. 
Subsequently, the State submitted a concept paper 
to HCFA but received no formal response. 
Therefore, the State began working on a waiver 
document and submitted it in draft to HCFA for 
preliminary review. MSHO submitted its formal 
proposal and its application for waivers to HCFA in 
April 1994. HCFA approved MSHO's waiver 
requests in April 1995. 

Section {9i5[b] - CCDTF: Approved January 
1988, April 1996, implemented January 1988. 
A temporary renewal has been received for the 
waiver. 

MinnesotaCare: Implemented September 1996. 

General Assistance Medical Care Managed Care: 
Implemented July 1995,- expansion approved. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 



Opiate treatment programs, outpatient,- inpatient, 
residential substance abuse treatment programs 
(e.g., extended care). 

Medicaid Mental Health Services 
Remaining Fee-For-Service 



case management); prescription drugS; mental 
health support for children (e.g., home-based ser- 
vices); Institution for Mental Diseases (IMD) ser- 
vices for individuals over age 65. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section ms - PMAP: Opiate treatment programs; 
outpatient; inpatient. 

Section iiis - MSHO: All Medicaid services pro- 
vided under PMAP: opiate treatment programs; out- 
patient; inpatient. Plus all Medicare services under 
Parts A and B. In addition, health plans provide ser- 
vices available under the current home and commu- 
nity-based waiver (Elderly Waiver), which consists 
mainly of extended home care benefits to frail elder- 
ly eligible for nursing home care. 

Section i9i5(b) - CCDTF: Outpatient (e.g., coun- 
seling); residential substance abuse treatment pro- 
grams (non-hospital based 24-hour care); opiate 
treatment programs. 

Medicaid Mental Health Services in 
Managed Care Plan 



Inpatient; outpatient (e.g., clinic services); mental 
health rehabilitation (e.g., day treatment, targeted 



Section ms - PMAP: Inpatient; outpatient (e.g., clin- 
ic services); prescription drugS; mental health reha- 
bilitation (e.g., day treatment); mental health sup- 
port for children (e.g., home-based services). PMAP 
includes all mental health services covered by 
Medicaid except targeted case management and 
IMD services (unless the health plan chooses to 
cover those services as an alternative to a covered 
service). 

Section ms -MSHO: Inpatient; outpatient (e.g., 
clinic services); mental health rehabilitation (e.g., 
day treatment); prescription drugS; IMD services for 
individuals over age 65. 

Section i9is[b] - CCDTF: Outpatient; rehabilita- 
tion; mental health support; IMD services for indi- 
viduals over age 65. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

MinnesotaCare: Opiate treatment programs; outpa- 
tient; inpatient; residential substance abuse treat- 
ment programs (e.g., extended care). 

General Assistance Medical Care Managed Care: 
Opiate treatment programs; outpatient; inpatient. 



146 



{SAMHSA} Managed Care Tracking System 



Non-Medicaid Mental Health Services in 
Managed Care Plan 

MinnesotaCarc: Inpatient,- outpatient (e.g., clinic ser- 
vices),- mental health rehabilitation (e.g., targeted 
case management); prescription drugs,- mental 
health support,- IMD services for individuals over 
age 65. 

General Assistance: Inpatient,- outpatient (e.g., 
clinic services); mental health rehabilitation (e.g., 
day treatment, targeted case management); pre- 
scription drugS; mental health support. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section Hi5 - PMAP: Early and periodic screening, 
diagnosis, and treatment (EPSDT) and additional 
services at the health plan's option. 

Section liis - MSHO, EPSDT and additional ser- 
vices at the health plan's option. 

Section i9i5[b) - CCDTF. EPSDT and additional 
services at the health plan's option. 

MinnesotaCare: EPSDT and additional services at 
the health plan's option. 

General Assistance Medical Care Managed Care: 
EPSDT and additional services at the health plan's 
option. 

Populations Covered Under Managed 
Behavioral Health 

Section iH5 -PMAP: Children and adults mandato- 
ry: Aid to Families with Dependent Children/ 
Temporary Assistance for Needy Families (AFDC/ 
TANF). 

Section iiis - MSHO: Voluntary adults: dually 
eligible. 

Section i9i5[b] - CCDTF: Voluntary adults and 
children: uninsured, underinsured, AFDCAANF, 
Supplemental Security Income, Seventh Omnibus 
Budget Reconciliation Act recipients not already 
covered under the PMAP or general assistance pro- 
grams. The program's eligibility threshold includes, 
as an entitlement, everyone who would otherwise 
qualify under the State's eligibility criteria for 
Medicaid or general assistance, and depending on 
availability of funds, may also include uninsured and 
underinsured persons earning up to 115 percent of 
the State median income. 



MinnesotaCare: Children and adults mandatory: 
general assistance, uninsured and underinsured, 
pregnant women and children. Medicaid eligibility 
is expanded for pregnant women and children up to 
age 20 with incomes up to 275 percent of FPL. The 
eligibility threshold for general assistance, unin- 
sured, and underinsured is 175 percent of FPL. 

General Assistance Medical Care Managed Care: 
Children and adults mandatory: general assistance. 
The program's eligibility threshold is persons earn- 
ing 60-1 15 percent of the State median income. 

State Managed Care Program 
Administration 



Section Hi5 - PMAP: The Health and Continuing 
Care Strategic Office (Medicaid) within the 
Minnesota Department of F4uman Services (DF4S) 
contracts with prepaid health plans (PF4Ps), which 
are nonprofit HMOs and may provide the services 
directly or subcontract with other entities. TTie 
State contracts with eight health plans. TTiree of the 
eight plans subcontract for management of behav- 
ioral health services. Most of the payments from the 
three health plans to the subcontractors are in the 
form of capitation with shared risk; however, there 
are exceptions. As part of these contracts, PHPs are 
responsible for proper assessment and placement of 
clients. 

Section ms - MSHO: Two divisions within the 
DHS have joint responsibility for MSHO: the 
Division of Purchasing and Service Delivery under 
the Health Care Administration, and the Aging 
Initiative. These agencies contract with for-profit 
HMOs, which are at full risk for both the healthy 
and frail elderly. HMOs may provide the services 
direcdy or subcontract services out to geriatric 
care networks. HMOs are encouraged to develop 
partnerships with long-term care providers and 
counties. 

HCFA monitors and oversees the State's admin- 
istration of MSHO and administers the Medicare 
payments to MSHO health plans. Under the 
waivers granted by HCFA to the State of 
Minnesota, the State provides most of the direct 
administration and coordination for the MSHO 
program. TTie State administers both Medicare and 
Medicaid administrative requirements for enrollees. 
It manages contracts for both Medicare and 
Medicaid with HMOs Integrated SeiAice 



July 31, 1998 



147 



Networks (ISNs), and Community ISNs (CISNs) 
who have demonstrated the clinical capacity to 
integrate and manage primary, acute, and long-term 
care services. Administrative requirements for 
Medicare and Medicaid financial solvency, enroll- 
ment, marketing, quality assurance, data collection, 
grievance, and appeals are also streamlined and 
merged under the State's contracting authority. 

In Minnesota, ISNs, CISNs, and HMOs must 
be not-for-profit organizations. However, the geri- 
atric care networks or geriatric care providers do not 
have to maintain a not-for-profit status provided 
they are Medicaid and/or Medicare. 

The characteristics of the geriatric care net- 
works serving MSHO enrollees vary in structure 
and risk-sharing arrangements. They include the 
following: A partnership between an HMO, hospi- 
tals, clinics, and long-term care facilities,- a hospital 
entity partnered with a broad-based long-term care 
provider, a group of long-term care providers who 
have created a joint venture for business arrange- 
ments with clinics and hospitals to manage a full 
spectrum of services on a capitated basis,- and a 
group of nursing homes that have formed a cooper- 
ative for more efficient contracting and purchasing 
arrangements. In addition, a county-run HMO has 
entered into a unique agreement with the county's 
Public Health and Social Services offices to make 
available and manage home and community-based 
services as part of a move to integrate services. We 
are not aware that the networks use an any-willing- 
provider structure, as the whole point of the net- 
works is to achieve closer coordination between 
acute and long-term care providers. However, 
MSHO health plan contracts do include a mecha- 
nism for payment of out-of- network nursing home 
providers so that placements may be made to facili- 
tate consumer preferences that fall outside the net- 
works. 

Section i9{5(b] - CCDTF: The Chemical 
Dependency Division of DHS allocates CCDTF 
funds to counties and Indian reservations, who man- 
age and deliver chemical dependency treatment ser- 
vices. Counties contract directly with community 
providers through what is called a Host County 
Agreement. It is only after a signed contract is sub- 
mitted to the DHS that providers are eligible to 
receive funding from the CCDTF. Therefore, the 
counties are responsible for selecting the providers 



and the array of services offered. Counties and 
Indian reservations act as case managers in deter- 
mining the appropriate intensity of chemical depen- 
dency rehabilitative services needed by the 
enrollee, and restrict the enrollee to receiving those 
services from a specified provider. Counties are ulti- 
mately responsible for the final decision in client 
placement. 

MinnesotaCarc: The Health and Continuing Care 
Strategic Office, within the Minnesota DHS, con- 
tracts with PHPs, which are nonprofit HMOs and 
may provide the services directly or subcontract 
with other entities. The Contract Management 
Division, in cooperation with the Mental Health 
Program Division, manages the contracts with the 
health plans. As part of these contracts, PHPs are 
responsible for proper assessment and placement of 
clients. 

General Assistance Medical Care Managed Care: The 
Health and Continuing Care Strategic Office, with- 
in the Minnesota DHS, contracts with PHPs, which 
are nonprofit HMOs and may provide the services 
directly or subcontract with other entities. Most of 
the payments from the health plans to the subcon- 
tractors are in the form of capitation with shared 
risk, however, there are exceptions. The PHPs are 
fully at risk unless they choose a lower capitation in 
return for an inpatient stop-loss. The Contract 
Management Division, in cooperation with the 
Mental Health Program Division, manages the con- 
tracts with the health plans. As part of these con- 
tracts, PHPs are responsible for proper assessment 
and placement of clients. 

Financing of Plans 

Section ms - PA/LAP. Medicaid is the source of funds 
for this program. PHPs are paid at a capitated rate. 
PHPs are fully at risk unless they choose a lower 
capitation in return for an inpatient stop-loss. Rates 
are based on trended historical fee-for-service (FFS) 
(with regular updates from FFS) and with a managed 
care savings factor of 10 percent for families with 
children plus 5 percent for the aged. Recipients are 
assigned rate cells based on several factors, includ- 
ing age, sex. Medicare, institutionalization status, 
eligibility status, and county of residence. 
Disproportionate share hospital payment adjust- 
ments and medical education are embedded in the 
FFS base from which each health plan's rates are 



148 



{SAMHSA} Managed Care Tracking System 



derived. A Managed Care Ratesetting Task. Force 
has been established by the Minnesota legislature to 
provide input from the health plans, provider, coun- 
ties, and advocates concerning alternative method- 
ologies for setting capitation rates and alternative 
purchasing arrangements for managed care services. 
The Managed Care Ratesetting Task Force evaluat- 
ed and developed recommendations concerning a 
competitive bid purchasing model and risk adjust- 
ment for future ratesetting years. The Task Force 
completed its work and reported to the 1997 
Minnesota legislature. A related Risk Adjustment 
Task Force continues to work on developing rate 
setting mechanisms to include risk adjustment. 

Section iiis - MSHO: A private foundation grant 
and Federal matching Medicaid dollars are the 
sources for this program. F4MOs are paid a capitat- 
ed rate. Most of the payments from the health plans 
to the subcontractors are in the form of capitation 
with shared risk,- however, there are exceptions. 

MSHO based its rate setting methodology on 
appropriate Medicare Adjusted Average Per Capita 
Costs (AAPCCs), PMAP rates for Medicaid acute 
and ancillary services, average payments for home 
and community-based long-term care services and 
short-term nursing facility services. DFHS provides 
each MSF40 contractor with a monthly per capita 
payment per enrollee, which includes the PMAP 
capitation, a Medicaid Nursing Facility Add-on, 
and the Average Elderly Waiver payment as appro- 
priate per MSF40's policies. HCFA makes direct 
payment to each MSF40 contractor for the month- 
ly AAPCC capitation. MSHO provides an 
increased Medicare capitation for frail elderly by 
applying an AAPCC risk adjustment factor. In 
exchange for these two Medicaid and Medicare 
capitation payments, MSHO contractors must pro- 
vide all the medically necessary Medicaid, 
Medicare, Elderly Waiver, and Nursing Facility ser- 
vices for the individual enrollee, with the exception 
of long-term nursing home per diems. 

Methods of payment for geriatric care networks 
vary. Each MSHO plan is expected to develop its 
own subcontracts with geriatric care networks to 
ensure enrollees have coordinated primary, acute, 
and long-term care services. DHS pays plans a cap- 
itated rate directly. In turn, a plan pays their net- 
works pursuant to the terms of their subcontracts. A 
plan may not, however, require specific payments to 



be made direcdy or indirectly to a physician or 
physician group as an inducement to withhold, 
limit, or reduce services to a specific enrollee and 
must comply with the physician incentive require- 
ments specified in 42 CFR 417.479. 

in MSHO, Medicare and Medicaid funds are 
blended at the plan level. DHS provides each 
MSHO plan with a monthly per capita payment per 
enrollee, which includes the PMAP capitation, a 
Medicaid Nursing Facility Add-on, and the Average 
Elderly Waiver payment as appropriate per 
MSHO's policies. HCFA makes direct payment to 
each MSHO plan for the monthly AAPCC capita- 
tion. MSHO provides an increased Medicare capi- 
tation for frail elderly by applying an AAPCC risk 
adjustment factor. 

Section i9i5(b) - CCDTF: All funding sources 
(State general funds. Substance Abuse Prevention 
and Treatment (SAPT) block grant funds, 
Medicaid) for the Chemical Dependency Division 
are pooled by DHS and placed into the CCDTF 
These funds are allocated to counties under a for- 
mula based on population, income, and welfare 
caseload, and to Indian reservations based only on 
population. The formula was developed through 
legislative action. Various savings estimates have 
been made, but overall expenditures go up as sav- 
ings are used to serve more people. The county pays 
15 percent of the treatment costs until its State allo- 
cation is expended. Thereafter, the county pays 100 
percent of the costs until the maintenance of effort 
obligation is met. After these funds are expended, 
the county funds pay 15 percent and the CCDTF 
Reserved Fund pays 85 percent. Virtually all chemi- 
cal dependency treatment services are provided on 
an FFS basis under the CCDTF. 

Minnesota Care-. State-only dollars is the source of 
funds for the non-Medicaid part of this program. 
PHPs are paid at a capitated rate. Federal funds are 
also used for the Medicaid portion. Recipient pre- 
miums are another source. The capitation rate was 
determined the same way as the rate for PMAP. 
Most of the payments from the health plans to the 
subcontractors are in the form of capitation \sith 
shared risk,- however, there are exceptions The 
PHPs are fully at risk unless they choose a lower 
capitation in return for an inpatient stop-loss, they 
may choose to receive a reduced rate if they elect a 
stop-gap coverage for inpatient. 



July 31, 1998 



149 



Gmeral Assistance Medical Care Managed Care. State- 
only dollars is the source oi funds for this program. 
PHPs are at full risk and are paid on a prepaid capi- 
tation basis. Rates and terms of payment are estab- 
lished the same way as PMAP. 

Coordination Between Primary and 
Behavioral Health Care 



Section iiiS - PMAP: Unknown. 

Section ms - MSHO: Unknown. 

Section i9i5[b] - CCDTF: All providers must fol- 
low State rules regarding assessment procedures and 
determination of appropriate level of care. 

Section iiiS - Minnesota Care: Unknown. 

General Assistance Medical Care Managed Care: 
Unknown. 

Consumer^Family Involvement 

Section ms - PMAP: In 1995, the State conducted a 
million dollar study of consumer satisfaction with 
PMAP, prepaid General Assistance Medical Care 
(GAMC) and other health programs and found a 
very high level of satisfaction with the publicly 
funded managed care programs. 

Section ms - MSHO: During the 5-year devel- 
opment phase of MSHO, several large public meet- 
ings and hundreds of smaller meetings were held to 
receive input on MSHO from the public. A formal 
advisory committee of 30 members met, and con- 
tinues to meet quarterly, for updates and input into 
the program. Also, a departmental planning team 
and two external advisory panels met numerous 
times to develop organizational and clinical design 
documents which were then circulated to more than 
100 individuals and organizations. In addition, 
MSHO staff have made numerous presentations to 
senior organizations and organizations of workers 
who advocate or provide social services to seniors. 
The formal independent evaluation of MSHO is 
just beginning via contract from HCFA to Dr. 
Robert Kane. Extensive enrollee consumer satisfac- 
tion surveys are in development. MSHO has also 
contracted with the National Chronic Care 
Consortium to conduct MSHO enrollee and family 
member focus groups. 

Section i9i5(b] - CCDTF: Substance abuse con- 
sumers were actively involved in the design of 
CCDTF Consumers were involved in various task 



forces that led to the creation of CCDTF at the leg- 
islature in 1986. 

Minnesota Care: Consumers and families can 
choose whether to enroll and pay the sliding scale 
premium. They can choose from eight health plans 
in most parts of the State. 

General Assistance Medical Care Managed Care: In 
1995, the State conducted a million dollar study of 
consumer satisfaction with GAMC and other health 
programs and found a very high level of satisfaction 
with the publicly funded managed care programs. 



Future Plans 



Section iH5 - PMAP: The Minnesota Demonstration 
Project for People with Disabilities program was 
submitted to HCFA as an amendment to the current 
PMAP program. This demonstration goes beyond 
the HMO model by allowing, at county option, 
inclusion of persons with long-term disabilities. 
County health plan partnerships will be capitated 
and at risk for the range of services covered. Current 
plans are for the program to begin early in 1999. 

Section Hi5 - MSHO: This program will contin- 
ue to be expanded. 

Section i9i5(h] - CCDTF: This program will con- 
tinue to be expanded. 

MinnesotaCare: This program will continue to be 
expanded. 

General Assistance Medical Care Managed Care: This 
program will continue to be expanded. 

* New Program Under Development: Children's 
Mental Health Collaboratives Capitation Option: 
This initiative is being developed for implementa- 
tion by local children's mental health collaboratives, 
based on the Child and Adolescent Service System 
Program system of care model. It is expected to 
begin either late in 1998 or early in 1999. Targeted 
to children who have SED, this initiative is being 
developed to parallel the Medicaid initiatives. It will 
establish a collaborative as the managing entity for 
the delivery of services under a direct capitation or 
through subcapitation. 

* New Program Under Development: The State plans 
to expand managed care service delivery under 
Medicaid using integrated service networks,- inte- 
grate Medicaid, MinnesotaCare, and GAMC and 
expand eligibility to additional uninsured low- 
income people, and link Medicaid and Medicare 
rate setting and data collection to Minnesota's 



ISO 



{SAMHSA} Managed Care Tracking System 



health care system reform efforts. Managed care 
entities may make special arrangements with exist- 
ing local child mental health collaboratives (which 
typically involve county, mental health, public 
health, corrections, and schools). Implementation 
of the new program is scheduled in three phases: 
Eventually, the State plans to integrate the Medicaid 
Prepaid Health Assistance Plan, GAMC, and 
MinnesotaCare into one program with the same 
universal benefit set for enrollees and supplemental 
benefits (including long-term care and access ser- 
vices). Then, the State will phase out the CCDTF 
program and integrate all licensed treatment into 
the basic benefit package. 

State Agency Administration 



The Medicaid authority in Minnesota is the Health 
and Continuing Care Strategy Office, within the 
DHS, The mental health authority is the Mental 
Health Program Division, under the DHS. 
Substance abuse treatment is administered by the 
Chemical Dependency Program Division, also 
under the DHS. 

Welfare Rieform 



Minnesota's Temporary Assistance for Needy 
Families (TANF) plan became effective in July 1997 
and was certified complete the same month. 
Although the State does not deny TANF to drug 
felons, it does conduct random testings. An individ- 
ual convicted of a drug-related offense after July 1, 
1997, can be required to submit to a random drug 
test as a condition of eligibility. 

The State submitted a Welfare-to-Work (WtW) 
plan to the U.S. Department of Labor on January 
29, 1998. The grant was approved March 2, 1998. 
Any nonmedical treatment that is normally outpa- 
tient based could be approved and WtW funds 
could be used to pay for such services. This could 
include chemical dependency treatment or mental 
illness treatment providing the request is document- 
ed in the file as necessary for them to become 
employed. One basic caveat is that WtW funds can- 
not be used to supplant other funding sources for 
these programs. The administering State agency is 
the Department of Economic Security. Funds will be 
used to provide direct client services to WtW par- 



ticipants. The substate allocation will be split 
among TANF, poor, and unemployed. 

• Minnesota received a waiver to operate "Work 
First" in Clay and Carver counties. For those 
applicants who are homeless, victims of domes- 
tic abuse, or in treatment for chemical depen- 
dency, a personal stabilization period of up to 8 
weeks will be allowed before participation in an 
employment plan. Minnesota will provide Aid 
to Families with Dependent Children (AFDC) 
benefits (vendor payments for the family's rent 
and utilities) as the family's first 6 months of 
benefits. The State will provide up to 180 days 
of post-placement services after a person leaves 
AFDC for work. Transitional Medicaid 
Assistance and Transitional Child Care eligibil- 
ity will be expanded. Participants will be sanc- 
tioned for failure to comply. 

• in addition, under Title IV- A, Section 1115, of 
the Social Security Act, the AFDC barrier 
removal waiver was approved on August 16, 
1996. This policy has been submitted as a State 
plan amendment that became effective in July 
1997 and provides a basis for approval of 
Federal Medicaid funding for parents in the 
MinnesotaCare program. 

County 

The State and the Association of Counties reached 
an intergovernmental agreement, which allows 
county-based purchasing of managed health care. If 
counties perform this role, all funds will be passed to 
the county, but counties will need to ensure that any 
risk-bearing provider networks meet State insurance 
requirements. 



Evaluation Findings 

Not applicable. 

Other Quantitative Data 

Not applicable. 



July 31, 1998 



151 



MISSISSIPPI 



OVERVIEW 

Mississippi does not include behavioral health services under managed care. However, in the last 
year, the Mississippi legislature took tv^o actions that may have a significant impact on managed 
behavioral health care: passage of a mental health system reform bill and a committee vote to expand 
the State's primary care case management program, HealthMACS, implemented under a 1915(b) 
waiver. 

Managed Care Programs for Behavioral Health Services 



I Medicaid Waivers 

I Not applicable. 

I Medicaid Voluntary 

I Not applicable. 

j 

I Other Managed Care Programs 

Not applicable. 




Geographic Location 

Not applicable. 

Status of Programs 

Not applicable. 



Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Outpatient; inpatient (e.g., hospitalization),- resi- 
dential substance abuse treatment for the early 
and periodic screening, diagnosis, and treatment 
population. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Inpatient; outpatient (e.g., clinic services); prescrip- 
tion drugS; Institution for Mental Diseases (IMD) 
services for individuals under age 21. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 



Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Not applicable. 

Populations Covered Under Managed 
Behavioral Health 



Not applicable. 

State Managed Care Program 
Administration 

Not applicable. 



July 31, 1998 



153 



Financing of Plans 

Not applicable. 

Coordination Between Primary and 
Behavioral Health Care 

Not applicable. 

Consumei^Family Involvement 

Not applicable. 

Future Plans 

None. 

State Agency Administration 



The Medicaid authority is the Division of Medicaid, 
within the Office of the Governor. The mental 
health authority is the Department of Mental 
Health. The substance abuse authority is the 
Division of Alcohol and Drug Abuse within the 
Department of Mental Health. 

Welfare Reform 

Mississippi's welfare reform program denies 
Temporary Assistance for Needy Families (TANF) 



benefits to drug felons, but does not test recipients 
for drug use. 

County 



On April 25, 1997, Mississippi signed into law SB 
2100, a bill that served as a major step in efforts to 
reform an outdated mental health system and ensure 
consumers access to a continuum of services. The 
law gave the State mental health department con- 
trol over 15 community health centers,- established 
formal guidelines for mental health workers, a griev- 
ance procedure, and a case management system, 
and mandated regional crisis intervention system to 
care for patients who destabilize. 

Evaluation Findings 

Not applicable. 

Other Quantitative Data 

Not applicable. 



154 



{SAMHSA} Managed Care Tracking System 



MISSOURI 



OVERVIEW 



Missouri has two ongoing managed care activities that affect behavioral health services; A 1915(b) 
waiver for health services that includes some mental health services, and a managed fee-for-service 
(FFS) carve-out program for substance abuse treatment. Additionally, the State is involved in a sys- 
tem redesign effort that is assessing the possibilities of using managed care technologies to better 
manage the services provided to Department of Mental Health (DMH) clients. 

Managed Care Programs for Behavioral Health Services 

Medicaid Waivers I 

Section 1915(b) - Managed Care+ (MC+) - physical health - integrated: Health maintenance organiza- 
tions (HMOs) provide general health care services and typically subcontract with a behavioral health 

managed care company for mental health. | 

fi 

Medicaid Voluntary I 

Not applicable. p 

i 

\\ 

Other Managed Care Programs I 

Comprehensive Substance Treatment and Rehabilitation (CSTAR) Program - substance abuse carve-out: I 

CSTAR is managed separately from MC+, by the Division of Alcohol and Drug Abuse. I 




Geographic Location 



Section i9i5[b] - MC+: Implemented in four areas of 
the State: Eastern Region, Western Region, 
Northwest Region, and Central Region. A tentative 
implementation date of Febmary 1, 1999, has been 
set for expansion of the 1915(b) managed care pro- 
gram to the Southwestern Region of the State. 
CSTAR Program-. Statewide. 

Status of Programs 



Section i9i5[b] - MC+: Implemented in October 
1995. The 1915(b) waiver was submitted April 24, 
1995, to the Health Care Financing Administration 
(HCFA), it was approved September 29, 1995. The 
waiver expired September 1997. The State request- 
ed a 90-day extension for the current waiver 
September 17, 1997, which was approved by HCFA 
September 18, 1997. The extension period was in 
effect October 1, 1997, through December 29, 
1997. On December 18, 1997, the State requested 
an additional 90-day extension, which was 
approved December 23, 1997. 



The second extension period was effective 
December 10, 1997, through March 29, 1998. 
Missouri received approval for a 2-year continua- 
tion of the 1915(b) waiver March 12, 1998. 
Approval of the waiver request covers a period of 2 
years from March 15, 1998, to March 14, 2000. 

CSTAR Program: CSTAR as an FFS program was 
implemented January 1, 1991. Approved as carve- 
out from MC+ in July 1996. Phase-in implementa- 
tion of managed care began November 1996. 
Implementation of managed care completed by July 
1997. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Inpatient; residential substance abuse services,- out- 
patient. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Inpatient, outpatient (e.g., clinic services),- mental 
health rehabilitation (e.g., targeted case manage- 



July 31, 1998 



155 



merit); prescription drugs,- Institution for Mental 
Diseases services for individuals under age 21 or 
persons age 65 and older. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section i9i5(b) -MC+: All under CSTAR program. 

Medicaid Mental Health Services in 
Managed Care Plan 

Section i9i5[b] - MC+: Mental health rehabilitation 
(e.g., targeted case management),- inpatient,- out- 
patient. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

CSTAR Program: The following CSTAR services are 
funded by Medicaid dollars: outpatient (e.g., day 
treatment, community support, individual, group 
and codependency counseling, group educational 
counseling, family therapy, extended day therapy). 
The following CSTAR services are covered by State 
matching funds: residential substance abuse treat- 
ment (e.g., non-hospital-based 24-hour care), out- 
patient,- detoxification. CSTAR providers conduct 
assessments to determine the appropriate level of 
care. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

CSTAl^ Program: Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Section i9i5[b) - MC+: Early and periodic screening, 
diagnosis, and treatment (EPSDT) screens. 
CSTAR Program: Unknown. 

Populations Covered Under Managed 
Behavioral Health 



Section i9i5(h] - MC+: Mandatory children and 
adults: Aid to Families with Dependent Children/ 
Temporary Assistance for Needy Families (AFDC/ 
TANF), Seventh Omnibus Budget Reconciliation 
Act (SOBRA) pregnant women and children. 

CSTAR Program: CSTAR services are available to 
anyone who meets the DSM IV criteria for sub- 



stance abuse and also meets the income guidelines 
for Medicaid. Most CSTAR clients have no insur- 
ance or very limited income. CSTAR targets Medi- 
caid eligible women and children by offering pro- 
gramming unique to their needs, such as child care 
and residential support for women with children. 

State Managed Care Program 
Administration 



Section i9i5(h] - MC+: The State Medicaid agency 
contracts with 14 for-profit and not-for-profit 
HMOs to provide services and program manage- 
ment. The Medicaid agency sets policy and pro- 
vides program oversight and monitoring. A number 
of the F4MOs subcontract mental health services to 
behavioral health managed care organizations. 
Health plans/behavioral health companies refer 
members seeking CSTAR services to a CSTAR 
provider. If a member refuses to receive care at a 
CSTAR provider, health plans are responsible for 
providing substance abuse services with an alterna- 
tive plan provider qualified to provide substance 
abuse services. MC-t- recipients are notified by the 
Division of Medical Services (DMS) that they can 
direcdy access CSTAR services without a referral 
from their primary care physician or health plan. 

CSTAR Program: All adult substance abuse ser- 
vices are carved out of MC-t- and managed separate- 
ly by the Division of Alcohol and Drug Abuse 
(ADA), which is responsible for program adminis- 
tration activities and contracts with providers. The 
Division has an interagency agreement with the 
Medicaid agency for the portion funded with 
Medicaid funds. The ADA performs authorization 
for a service package, based on a detailed service 
matrix. If a physician thinks more services are nec- 
essary, a clinical review is performed by licensed 
clinical staff employed by ADA. CSTAR providers 
are responsible for determining level of care needed. 
The ADA developed a standardized assessment 
instrument based on the Addiction Severity Index 
and other instruments. 

The provider network for CSTAR at present 
consists of agencies that have a contract with the 
Division of ADA to provide CSTAR services and 
that have been certified by the Division as a CSTAR 
agency. There are approximately 35 not-for-profit 
providers currently participating in the program, of 
these, 1 3 are women's and children's programs, 9 are 



156 



{SAMHSA} Managed Care Tracking System 



adolescent programs, and the rest are for the gener- 
al population. 

Financing of Plans 

Section i9i5(b) - MC+: Medicaid is the sole source of 
funding. HMOs receive a capitated payment. There 
is stop-loss for certain conditions. Missouri estab- 
lishes an actuarially sound rate range. All competi- 
tive bids must be within this range to be accepted. 
Stop-loss provisions: Stop-loss limits apply only to 
hospital inpatient claims that exceed $50,000 per 
person, per health plan, per contract year The State 
is responsible for 80 percent of the inpatient claims 
exceeding this threshold. 

The base line cost and utilization data used to 
estimate the upper payment limits (UPLs) and 
establish the rate ranges during the MC+ contract 
periods were taken from the FFS information in the 
State's database. The FFS database is adjusted to 
reflect the portion of eligible services and expendi- 
tures for which participating plans will bear respon- 
sibility. Next, the adjusted database is used to calcu- 
late base per-member per-month rates, and these 
base rates are subjected to a series of adjustments to 
develop FFS-equivalent UPLs. Finally, the State's 
final rate ranges are calculated by adjusting the FFS 
equivalents for, among other things, changes in unit 
cost and utilization rates, which are expected to 
accompany managed care. 

CSTAR Program: Medicaid, State-only funds, 
and Federal block grants finance this program. ADA 
combines general revenue funds and some portion 
of Federal block grant dollars for the Medicaid 
match. Providers are paid on an FFS basis. Providers' 
rates were established on a historical cost analysis of 
the fiscal year 1991 budget cost. The program is still 
under evaluation for cost savings. At present it is 
believed that any cost savings generated by utiliza- 
tion review will be reinvested in additional service 
availability. 

Coordination Between Primary and 
Behavioral Health Care 



CSTAR Program: The Department of Mental 
Health (DMH) participates with the DMS 
Behavioral Health subgroup on quality improve- 
ment. This group has met with the CSTAR 
provider network and developed a notification of 
care activity report. This report is used to help link 
CSTAR participants to behavioral and physical 
health care. 

Consumer-Family Involvement 



Section i9i5[b] - MC+: ADA and DMS consider 
referral and ongoing communication critical to 
ensuring coordination and continuity of care for 
MCh- members. 



Section i9i5[b) - MC+: Prior to implementation of 
the 1915(b) waiver, DMS held public hearings 
across the State. In addition, the Missouri Health 
Watch — an advocacy group composed of persons 
from Legal Services of Eastern Missouri, the 
Missouri Association for Social Welfare, and other 
individuals concerned about the impact of man- 
aged care on Medicaid recipients — monitored the 
program development and made recommenda- 
tions to DMS and to HCFA. Many of their 
recommendations were incorporated into the 
program. 

The request for proposal called for the estab- 
lishment of a consumer advisory group to assist 
in the development of educational materials and 
descriptions of grievance procedures. A separate 
Consumer Advisory Group has been formed to 
participate in the ongoing quality assessment and 
improvement process for the managed care 
program. 

In the development of MC-i-, various commit- 
tees looked at the different segments of health care 
delivery. The DMH was an active participant and 
conducted public forums. DMH's advisory councils, 
representing consumers, families, providers, and 
other agencies, were active in the planning and 
implementation of MC-i-. 

CSTAR Program: Missouri statutes provide that 
ADA have a statewide advisory council to advise 
the Division on its programming efforts. This coun- 
cil is made up of consumers and providers. 
Additionally, the Division has six regional advisory 
councils, also consisting of consumers and 
providers, which act as subgroups of the statewide 
council. The statewide council and the regional 
councils play significant roles in the development of 
the Division's budget and Riture programming. 



July 31, 1998 



157 



Future Plans 



Section i9i5[b] - Managed Care+: A tentative imple- 
mentation date of February 1, 1999, has been set for 
expansion of the 1915(b) managed care program to 
the Southwestern Region of the State. There are no 
current plans to expand the 1915(b) managed care 
program to other regions in the State. 

CSTAR Program: DMH is now involved in a sig- 
nificant system redesign effort known as the 
Psychiatric and Substance Abuse Treatment 
Services and Supports System Redesign Process. 
This effort is examining the possibilities of using 
managed care technologies to better manage the 
services provided to DMH clients. The effort will 
include significant public input and guidance from 
the Department's Mental Health Commission. An 
internal team of DMH staff has been established to 
study and plan the Department's approach to this 
effort. At present, CSTAR programming is consid- 
ered to be a service that may be included in any new 
managed approach DMH may implement. 

State Agency Administration 



The Medicaid authority is DMS, which is within 
the Department of Social Services. The mental 
health authority is DMH, which also houses ADA, 
the substance abuse authority. 

Welfare Reform 

Missouri's TANF plan became effective in October 
1996 and was certified complete in December 1996. 



The program denies benefits to dmg felons but does 
not test its recipients for drug use. 

Missouri's Welfare-to-Work plan was submitted 
to the U.S. Department of Labor on February 18, 
1998. The administering State agency is the 
Division of Job Training and Development. Half of 
substate funds will go to poor individuals, and half 
will go to TANF recipients. 

Rehabilitation Model jar Child Welfare: Covers child 
protective services, residential care, family support, 
and aftercare services. The goal of this initiative is to 
restructure the child welfare service delivery system 
toward a managed, comprehensive continuum of 
care model consistent with programmatic objec- 
tives. Child Welfare, the DMH, and Medicaid con- 
tribute to the initiative. The State child welfare 
agency contracts with a managed care organization, 
which is at partial risk. This initiative will be imple- 
mented January 1, 1999. 



County 

Not applicable. 



Evaluation Findings 

Unknown. 

Other Quantitative Data 

Unknown. 



158 



{SAMHSA} Managed Care Tracking System 



MONTANA 



OVERVIEW 



The Montana Department of Public Health and Human Services operates three capitated programs, 
one specific to mental health and two for physical health services. Substance abuse services are 
excluded from the physical health managed care program and remain in the fee-for-service (FFS) sys- 
tem. The mental health v^aiver, known as the Mental Health Access Plan (MHAP), covers mental 
health services and integrates multiple funding streams (e.g., Medicaid, State hospital, general rev- 
enue, mental health block grant dollars) to serve Medicaid and non-Medicaid populations. A man- 
aged care organization (MCO) and a coalition of mental health and substance abuse providers, in a 
nonprofit joint venture, manage the plan. 

Managed Care Programs for Behavioral Health Services 




. 'iiC!^Zii,'t!t;:itt;^;i^i;f}iSSili}i,ii}ilil}!!t;SStSittfXi 



Medicaid Waivers 

Section 1915(b) - MHAP - mental health stand-alone: Provides acute and long-term care mental health 



services. 




Medicaid Voluntary 
Not applicable. 



Other Managed Care Programs 
Not applicable. 



Geographic Location 

Section i9i5[b) - MHAP: Statewide. 



Status of Programs 

Section {9i5[b) - MHAP: Submitted May 7, 1996,- 
approved August 1996, implemented April 1, 
1997. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 



?a!«sww?a«!«sftass%w^^ 



inpatient, detoxification, outpatient. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Pharmacy. 

Medicaid Substance Abuse Services in 
Managed Care Plan 



Section i9i5[b) - MHAP: Not applicable. 



Medicaid Mental Health Services in 
Managed Care Plan 

Section i9i5(b) - MHAP: Inpatient (e.g., psychiatric 
hospitalization); Institution for Mental Diseases 
(IMD) services for individuals over age 65 and 
under age 21,- outpatient (e.g., evaluation, assess- 
ment),- crisis (e.g., emergency services 24 hours per 
day); residential; mental health rehabilitation (e.g., 
individual, group, and family therapy); mental 
health support. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Section i9{5[b] -MHAP: Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Section i9i5(b] - MHAP: Mental health services 
include inpatient (e.g., psychiatric hospitalization); 
IMD services for individuals over age 65 and Linder 



July 31, 1998 



159 



age 21; outpatient (e.g., evaluation, assessment),- 
crisis (e.g., emergency services 24 hours per day),- 
residential; mental health rehabilitation (e.g., indi- 
vidual, group, and family therapy); mental health 
support; pharmacy. 

Substance Abuse Prevention and Mental 
Health Promotion In Managed Care Plan 

Section i9i5[b) - MHAP: Early and periodic screen- 
ing, diagnosis, and treatment (EPSDT) for chil- 
dren. Mental health promotion strategies are being 
developed. 

Populations Covered Under Managed 
Behavioral Health 

Section 19 i 5(h) - MHAP: Adult and children manda- 
tory: Aid to Families with Dependent Children/ 
Temporary Assistance for Needy Families (AFDC/ 
TANF), Supplemental Security Income, Optional 
Expansion for pregnant women and children. State 
residents with an income up to 200 percent Federal 
poverty level (FPL), dually eligible Medicare/ 
Medicaid up to 200 percent FPL. 

Non-Medicaid clients must qualify as having a 
severe and disabling mental illness (SDMI) for 
adults or a severe emotional disturbance (SED) for 
children according to State definitions in order to 
be covered under MF4AP. 

State Managed Care Program 
Administration 

Section i9i5[k] - MHAP: The Department of Public 
Health and Human Services' (DPHHS) Addictive 
and Mental Disorders Division (AMDD) contracts 
with Montana Community Partners (MCP) to pro- 
vide mental health services under MHAP. The 
Addictive and Mental Disorders Division has 
responsibility for contract oversight including mon- 
itoring of access and quality of services. 

MCP is a partnership between a private, for- 
profit MCO and a coalition (Care Coalition) of 30 
human service organizations and community men- 
tal health centers (CMHCs). Care Coalition mem- 
bers have representation on the MCP Board of 
Directors. MCP has responsibility for service man- 
agement, development, authorization, coordina- 
tion, and provision; eligibility determination for 
non-Medicaid members; grievance and appeals 



handling; provider enrollment and payment; and 
quality assurance activities including outcome 
measurement. MCP is managed from a central pro- 
gram office in Billings, Montana, with satellite 
offices around the State. 

Providers under the MHAP include any appro- 
priately licensed or certified professional or facility, 
not just members of the Care Coalition. There is an 
open provider panel that must include at least all of 
the provider types that traditionally provide public 
mental health services. Specifically, the provider 
network consists of 671 individual providers as well 
as mental health professionals in community mental 
health centers, residential treatment centers, hospi- 
tals, and clinics. In communities where psychiatrists 
have not yet signed contracts with MCP, services 
are provided by primary care physicians (PCPs) and 
psychiatrists contracting with CMHCs or other 
MCP service providers. 

Outstanding implementation issues include 
unpaid claimS; provider resources necessary to 
track, resubmit, and otherwise resolve problems and 
disputed claims; continued inconsistency in the 
authorization of intensive services; time lags in 
authorization of outpatient services; and the length 
of time it has taken to negotiate and execute con- 
tracts with MCP. These issues were exacerbated by 
changes in the ownership of the behavioral health 
managed care organization (BHMCO). The 
BHMCO was bought by one private, for-profit 
BHMCO, which was then subsequently purchased 
by another private, for-profit BHMCO. While the 
latter two BHMCOs have more experience in the 
public sector than the original MCP partner, confu- 
sion and uncertainty caused by new corporate 
arrangements have prevented potential advantages 
from being fully realized. 

MHAP's operational plan outlines many areas 
for improvement in the operations of MCP. The 
plan is the result of negotiations between the 
State and MCP to address the implementation 
problems experienced in Montana's MHAP. It 
includes provisions for compensation of the State, 
corrective actions to improve the operations of 
Montana's MHAP program, requirements to plan 
and implement longer term improvements, and 
amended reporting requirements. This plan serves 
as the basis for a contract amendment between 
MCP and the State to ensure acceptable levels of 
performance and accountability to the State of 



160 



{SAMHSA} Managed Care Tracking System 



Montana. Montana AMDD staff will establish 
teams to monitor MCP's compliance with the 
terms of the plan over the remaining life of the 
contract. 

As an attempt to address these implementation 
issues, the State's contractor replaced the current 
management information services (MIS) system on 
July 1, 1998, in order to begin processing claims in 
a more timely and coordinated fashion. 

Financing of Plans 

Section i9i5[b) - MHAP: Montana's DPHHS, AMDD 
entered into a statewide risk contract with MCP. 
This program comprises not only a capitated 
Medicaid carve-out for mental health services, but 
also all State-funded (including the mental health 
block grant) mental health services, specifically 
including the Montana State Hospital. The State 
pays the MCO a capitated rate for specified 
Medicaid services, along with a separate fixed sum 
for the Federal mental health block grant and State 
general revenue dollars for mental health. The 
amount paid for the block grant and State general 
revenue dollars reflects the amounts historically 
spent to provide services to the individuals meeting 
criteria for these funding streams. The money from 
all three funding sources is pooled at the MCO 
level. The MHAP contract is a full-risk contract 
with no stop-loss provision or risk corridors. 
Coalition providers are not at risk and are paid on 
an FFS basis but will participate in 50 percent of any 
"savings" achieved by MCP before the managed 
care company takes a profit. 

The capitation rate paid to MCP is based on 5 
percent less than historical costs. As for profits gen- 
erated, the MCO is limited to either 0, 2.5, 5, or 
7.5 percent profit, depending on the State's classifi- 
cation of their performance as inadequate, ade- 
quate, good, or superior. First-year performance is 
currently being assessed. MCP, however, has not 
experienced any profit for the first year,- on the 
contrary, the plan has experienced very significant 
losses. 

Coordination Between Primary and 
Behavioral Health Care 

Section i9i5(b) - MHAP: MCP provider is required, 
under the terms of the contract, to contact a mem- 
ber's primary care physician, when known. 



Consumer-Family Involvement 

Section i9 15(b) - MHAP: MHAP was designed over 3 
years with the assistance of a Mental Health 
Managed Care Advisory Group, which included 
primary consumers, family members of consumers, 
and representatives of advocacy groups. Various 
drafts of the MHAP request for proposals were 
widely distributed to anyone — especially consumer 
and family groups — who cared to receive it,- com- 
ments and suggestions were solicited and frequent- 
ly incorporated. Consumer comment was encour- 
aged through meetings between Department staff 
and consumer groups, both face-to-face and using 
the State's interactive video system. 

MCP's board of directors includes consumers 
and family members. MCP supports a statewide 
State Consumer Council that includes consumers 
along with other stakeholders. They are appointed 
by local Citizen's Advisory Councils that are open 
to all; meetings are widely publicized to consumers, 
family members, and other stakeholders. 

In addition, in response to feedback from con- 
sumers and advocacy groups, MCP simplified its 
grievance and appeals process. The changes make 
the system more user-friendly and provide quicker 
resolutions. MHAP also utilizes MCP peer advo- 
cates, who help members or families resolve any 
problems with MCP care or services. They put their 
knowledge of MCP's system to use to the advantage 
of members and their families. They represent 
member and family interests within MCP. 

Future Plans 

Section i9i5(b] - MHAP: DPHHS contracted for 
technical assistance with a management consulting 
firm with expertise in the managed care industry. 
The consulting firm facilitated the development of 
an "Operational Plan" (with specific deliverables, 
deadlines, and financial penalties) to help resolve 
lingering implementation problems of MHAP. 

Additionally, DPHHS requested, through the 
executive planning process, increased funds totaling 
$12.7 million for the 2001 biennium for the mental 
health managed care program. Approximately $4.4 
million is State general funds, the remainder is 
Federal Medicaid funds. The requests are for antici- 
pated caseload increases, provider rate increases, 
and an anticipated revision (in the State's favor) of 
the Federal medical assistance percentage rate. 



July 31, 1998 



161 



* New Program Under Development: Children's Health 
Insurance Program will begin by September 1999. 

State Agency Administration 

DPHHS houses Medicaid, Mental Health, and 
Substance Abuse departments. The Medicaid 
Services Bureau is under the Health Policy and 
Services Division within DPHHS. Mental Health 
and Substance Abuse are in one division, AMDD. 

Welfare Reform 

Families Achieving Independence in Montana, 
Montana's welfare reform demonstration, approved 
in 1995, is expected to reduce the number of 
Montana's eligible for TANF and thus reduce the 
number of Medicaid-eligible individuals. Because 
the MHAP covers individuals with SMDl or SED 
when their family income is not greater than 200 
percent Federal poverty level, the impact of losing 
Medicaid benefits will be lessened for those diag- 
nosed with a mental illness. Montana specifically 



included a psychotropic medication benefit in the 
MHAP for non-Medicaid eligible members as a 
way to allow individuals with a serious mental ill- 
ness to take employment without risking loss of 
subsidized medications that would normally occur 
when they lost eligibility for Medicaid. For those 
individuals with substance abuse problems, 
Montana does not require mandatory drug testing,- 
however, if an individual qualifies for TANF and 
commits a drug felony, he or she will be denied 
TANF benefits. 

County 

Not applicable. 

Evaluation Findings 

Unknown. 

Other Quantitative Data 

Not applicable. 



162 



{SAMHSA} Managed Care Tracking System 



N EBRASKA 



ovERvrew 



Nebraska has two Medicaid managed care waivers: one waiver is for mental health and substance 
abuse, and one is for physical health services. Although geographical implementation has varied by 
components, the two waivers operate as one managed care program. Contract programmatic require- 
ments, as well as quality assurance requirements, are the same for both. Policies and procedures have 
been established to ensure a coordinated effort, and continuity of care is provided by the primary 
care physician and the mental health/substance abuse service provider 

The behavioral health stand-alone establishes an integrated service delivery system for mental 
health and substance abuse services for Medicaid and child welfare clients. This program is managed 
by a for-profit behavioral health managed care organization (BHMCO). 

Additionally, the State has implemented a separate managed care program for clients receiving 
behavioral health services from State general revenue dollars. Under this program, the State has con- 
tracted with a private, for-profit BHMCO to perform utilization review for State-operated inpatient 
psychiatric facilities and community behavioral health services. 

Managed Care Programs for Behavioral Health Services 

Medicaid Waivers 

Section 1915(b) - Nebraska Health Connection Mental Health/Substance Abuse (MH/SA) - behavioral 

health stand-alone: Contract that covers behavioral health services on a capitated basis. 

Section 1915(b) - Nebraska Health Connection Medical/Surgical Component - general health - integrated: 
The medical/surgical component consists of two capitated health maintenance organizations (HMOs) 
and a Primary Care Case Management (PCCM) Network in Douglas, Sarpy, and Lancaster Counties. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

Behavioral Health Redesign - behavioral health stand-alone:The Nebraska Health and Human Services 
System, Department of Health and Human Services, has contracted with a private managed care 
organization under an administrative services only (ASO) arrangement to manage care for State- 
operated inpatient psychiatric facilities and community behavioral health services. 




Geographic Location 

Section i9i5[b) - Nebraska Health Connection MH/SA: 
Statewide. 

Section i9i5(b] - Medical/Surgical Component: 
Douglas, Sarpy, and Lancaster Counties. 

Behavioral Health Redesign: Statewide. 

Status of Programs 

Section i9i5[b} - Nebraska Health Connection MH/SA: 
Submitted February 16, 1995, approved June 23, 



1995,- implemented July 1, 1995. Renewal applica- 
tion submitted November 17, 1997, renewal 
approved March 26, 1998. 

Section {9 i 5(b) - Medical/Surgical Component: 
Submitted February 16, 1995, approved June 23, 
1995, implemented July 1, 1995. Extended until 
June 27, 1998. 

Behavioral Health Redesicjn: Implemented January 
1, 1997. 



July 31, 1998 



163 



Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Outpatient; crisis,- inpatient,- residential substance 
abuse treatment programs (e.g., non-hospital-based 
24-hour care, day treatment). Substance abuse treat- 
ment at any level of care is not covered for clients 
age 2 1 and over. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Inpatient; outpatient; mental health rehabilitation 
(e.g., services to assist individuals to develop or 
improve task and role-related skills and social and 
environmental supports); mental health residential 
(e.g., treatment foster care, treatment group home); 
crisis; Institution for Mental Diseases (IMD) ser- 
vices only for individuals age 20 and under or age 65 
and older; prescription drugs. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section i9i5(b] - Nebraska Health Connection MH/SA: 
Not applicable for adults. For children, services 
include outpatient; crisis; inpatient; residential sub- 
stance abuse treatment programs (e.g., non-hospi- 
tal-based 24-hour care). Substance abuse treatment 
at any level of care is not covered for clients age 2 1 
and over. 

Section i9i5(b] - Medical/Surgical Component: 
Outpatient services (e.g., counseling, therapeutic 
services); prescription drugs only for individuals 
under age 20. Medications must be prescribed; they 
may be legend, over-the-counter, or compounded 
medications. 

Medicaid Mental Health Services in 
Managed Care Plan 



Section i9i5[b] - Nebraska Health Connection MH/SA: 
Inpatient; outpatient; mental health rehabilitation 
(e.g., services to assist individuals to develop or 
improve task and role-related skills and social and 
environmental supports); mental health residential; 
crisis; IMD services for all individuals. 

Section i9i5(b) Medical/Surgical Component: 
Outpatient; prescription drugs. 



Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Behavioral Health Redesign: Inpatient; outpatient (e.g., 
clinic services); residential substance abuse treat- 
ment programs (e.g., non-hospital-based 24-hour 
care settings); detoxification; opiate treatment 
(there is one methadone clinic in the State); and cri- 
sis services (which are designed primarily to address 
mental health issues, but a significant percentage of 
the population served is either dually disordered or 
substance abusing). 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Behavioral Health Redesign: Inpatient; outpatient; men- 
tal health residential (e.g., 24-hour residential care); 
mental health rehabilitation; mental health support; 
crisis; IMD services for all individuals. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section i9i5[b] - Nebraska Health Connection h4H/SA: 
Early and periodic screening, diagnosis, and treat- 
ment (EPSDT) screens. 

Section i9i5[b] Medical/Surgical Component: EPSDT 
screens. 

Behavioral Health Redesign: None offered. 

Populations Covered Under Managed 
Behavioral Health 

Section i9i5(h] - Nebraska Health Connection MH/SA: 
Children and adults mandatory: Aid to Families 
with Dependent ChildrenAFemporary Assistance for 
Needy Families (AFDC/TANF), Supplemental 
Security Income (SSI), Seventh Omnibus Budget 
Reconciliation Act (SOBRA). 

Income eligibility will be increased to 185 per- 
cent Federal poverty level (FPL) for pregnant 
women and children age 18 and younger, as of 
September 1, 1998. The children will be uninsured. 

Section i9i5(b] Medical/Surgical Component: 
Children and adults mandatory: AFDCAANF, SSI, 
SOBRA. Income eligibility will be increased to 185 
percent FPL for pregnant women and children age 
1 8 and younger, as of September 1 , 1 998. The chil- 
dren will be uninsured. 



164 



{SAMHSA} Managed Care Tracking System 



Behavioral Health Redesign: Uninsured, underin- 
sured. Currently, the Medicaid MH/SA program 
provides managed health care for mandatory 
Medicaid-eligible clients. The State is moving 
toward a behavioral health redesign to include man- 
agement of behavioral health services to mandatory 
and nonmandatory Medicaid-eligible and non- 
Medicaid-eligible who are uninsured or underin- 
sured. 

State Managed Care Program 
Administration 

Section i9i5[h') - Nebraska Health Connection MHISA-. 
The Nebraska Health and Human Services System 
contracts with a for-profit BHMCO, which is at full 
financial risk. The managed care entity has an any- 
willing-provider arrangement and will enroll any 
provider that is enrolled with the Nebraska Medical 
Assistance Program and meets the managed care 
organization (MCO) standards. Some of the exist- 
ing public behavioral health sector programs have 
become credentialed by the MCO to provide ser- 
vices. 

Section i9i5{h) Medical/ Surgical Component: The 
Nebraska Health and Human Services System pays 
primary care providers (PCPs) a fee for gatekeeping 
services. All Medicaid-enrolled providers partici- 
pate in the PCCM network. Physicians wanting to 
be PCPs sign an agreement with the PCCM net- 
work administrator. 

Behavioral Health Redesign: The Department of 
Health and Human Services (DHHS) contracts 
with a private, for-profit MCO under an ASO 
arrangement to provide utilization management for 
all State-funded fee-for-service (FFS) programs. The 
ASO authorizes services and makes payments to 
providers, collects data, and monitors consumer 
outcomes. DHHS manages the provider network, 
as well as contracts with six Regional Centers, 
which provide inpatient and outpatient services. 

In Nebraska there are six regions, composed of 
a varying number of counties, that define the geo- 
graphic boundaries of the service areas within the 
State. The regions are defined in statute, and there 
are statutory provisions for these entities to make 
available behavioral health services within their 
geographic areas. The DHHS contracts with the six 
regions for the behavioral health services funded 
with State general. Federal MH/SA block grant, and 



other miscellaneous funds. Each region has a panel 
of providers that constitute a comprehensive array 
of behavioral health services. Most of these 
providers are private nonprofit entities that have 
subcontractual relationships with the regions in 
which they operate,- however. Region I and Region 
11 provide services directly under their own organi- 
zational auspices. Regional Centers are State-oper- 
ated psychiatric hospitals that provide acute inpa- 
tient and secure residential levels of care. Each 
Regional Center serves a catchment area of desig- 
nated regions. Hastings Regional Center serves 
Regions I, 11, and 111, Norfolk Regional Center 
serves Regions IV and VI,- and Lincoln Regional 
Center serves Region V and provides the statewide 
forensic capacity. There is no contractual relation- 
ship between the Regional Centers and the State, as 
they are State-operated facilities. 

Financing of Plans 



Section I9i5[h) - Nebraska Health Connection MH/SA: 
Medicaid is the source of funds. The MCO is paid 
on a capitated basis. Payment rates are based on 
paid claims data from previous years and financial 
information developed by an actuarial firm. The 
rates estimate a 76 percent upper payment limit sav- 
ings for the State. 

The BHMCO may obtain a risk-sharing 
arrangement from an insurer other than the Health 
and Human Services System for coverage of clients 
as long as it remains substantially at risk for the ser- 
vice provision under the contract. Providers are paid 
on an FFS basis, however. The contractor is doing 
some case rating with groups of providers, which 
includes a limited amount of risk. 

The Medicaid Managed Care contractor is 
introducing the concept of risk into its Regional 
Care Continuum (RCC) development process. The 
RCCs are essentially provider networks under con- 
tract to provide Medicaid Managed Behavioral 
Health Service in the six service areas of the State. 
Each RCC has a budget developed based on paid 
claims experience with the contractor. Initially, 
there is no downside risk to the RCC, but it does 
have the opportunity to participate in a reward 
incentive pool based on its ability to outperform its 
budget. The contractor's goal in developing the 
incentivized budget plan is to provide RCCs with 
the opportunity to become comfortable with a risk 



July 31, 1998 



165 



model without initially bearing any real risk. After a 
mutually agreeable period of time, the incentivized 
budget plan will convert to a risk/reward arrange- 
ment with the exposure of each party being negoti- 
ated based on the specific RCC and the unique risk- 
bearing capacities of each RCC partner. 

Section i9i5(h) Medical/ Surgical Component: Medi- 
caid is the source of funds. Providers are paid a set 
fee for gatekeeping services. The fee was set by 
administrative decision. No savings are anticipated 
from the PCCM. 

Behavioral Health Redesign: State general revenue 
funds this program. The ASO is paid a set fee for 
administrative services. The Department pays 
Regional Centers according to a global budget for 
services. Providers are paid on a managed FFS basis. 
At the present time, there is no risk associated with 
the behavioral health redesign. Regional Centers, as 
State-operated facilities, are funded consistent with 
other State programs: An annual budget is estab- 
lished through the legislative appropriation process. 
The Department contracts with the six regions for 
non-Medicaid behavioral health services and pays 
them monthly for FFS costs (aggregated FFS claims 
from the subcontracted providers) and also for 
capacity-related costs (expense reimbursement) for 
those regional services that cannot easily be operat- 
ed under an FFS arrangement. Providers are paid 
monthly by the regions, typically upon receipt of 
payment from the State. 

Coordination Between Primary and 
Behavioral Health Care 



Section i9i5(h] - Nebraska Health Connection MH/SA: 
There is no formal link between physical health and 
mental health and substance abuse services. 

Section i9 i 5[h] Medical/Surgical Component: Primary 
care physicians refer patients to mental health and 
substance abuse services provided under the carve- 
out. 

Behavioral Health Redesign: Primary care physician 
and MF4/SA services provide coordination. 

Consumer^Family Involvennent 

Section i9i5(b) - Nebraska Health Connection MH/SA: 
Members of a stakeholder community helped with 
the planning of this program. Stakeholder members 
included representatives of the hospital, home, and 



insurance industries, six consumers, and community 
members. The State mental health authority and 
children's experts were also involved in the develop- 
ment of the waiver. 

Section i9i5[b) Medical/Surgical Component: Con- 
sumers and families provided input into the program 
through a public hearing, focus groups, and 
client/provider advisory groups. 

Behavioral Health Redesign: Consumers and fami- 
lies provided input into the program through a pub- 
lic hearing, focus groups, and client/provider advi- 
sory groups. 

Future Plans 



The State plans to integrate all three of these pro- 
grams in the future: 

• Section i9i5[b] - Nebraska Health Connection MH/SA 

• Section 19 i 5(b) Medical/Surgical Component 

• Behavioral Health Redesign: The plan for this pro- 
gram is development of local integrated health net- 
works that would create "ownership and partner- 
ship" of all health and human services at the local 
level. 

State Agency Administration 



The Department of Health is the Medicaid author- 
ity. The mental health and substance abuse authori- 
ties are under the Department of Public Institutions. 
Both Departments are housed within the FHealth 
and F4uman Services System, a super-agency that 
encompasses five major State departments. 

Welfare Reform 

The State's TANF program became effective 
December 1, 1996, and was certified complete 
December 7, 1996. The plan denies TANF benefits 
to drug felons but does not test recipients for drug 
use. 

The State's Welfare-to-Work proposal was sub- 
mitted to the Department of Labor on December 
12, 1997, and was approved January 29, 1998. The 
administering State agency is the Department of 
Labor. Fifty percent of the matching funds will be 
State dollars. Fifty percent of the substate allocation 
will go to poor individuals, the rest will go to TANF 
recipients and the unemployed. The Welfare-to- 
Work program encompasses some mental health 
and substance abuse provisions. 



166 



{SAMHSA} Managed Care Tracking System 



County 

Not available. 

Evaluation Findings 

The External Quality Audit and the FHC Options 
Quality Improvement Manager indicated the fol- 
lowing Quality of Service and Quality of Care 
Studies/Pattern Analyses: 

Client Satisfaction Survey 1996, 1997, 1998 
Provider Satisfaction Survey 1996, 1997, 1998 
Readmission Study 1996, 1997, 1998 
Access to care 

Migrations to higher and lower levels of care 
Outpatient follow-up after care 
Critical incidents 
Provider quality profiling 



• Attention Deficit Hyperactivity Disorder 
(ADHD) medication management 

• Reliability and validity of data entry into the 
data base 

• Predictors of readmission 

Most of these were verified through the 
External Quality Audit Review and were added 
since the last review report. All of these surveys, 
studies, and pattern of care analyses are indicators of 
the impact of managed care on the clients, 
providers, and system. 

Other Quantitative Data 

Enrollment is currently 1 10,000 statewide. The 
State is in the process of obtaining encounter data. 
Some utilization reports have been generated by the 
MCO for the State. 



July 31. 1998 



167 



NEVADA 



OVERVIEW 

At this time, managed care systems do not include behavioral health services. 

Managed Care Programs for Behavioral Health Services 

I Medicaid Waivers 
Not applicable. 

I Medicaid Voluntary 
Not applicable. 

I Other Managed Care Programs 
Not applicable. 



Geographic Location 

Not applicable. 

Status of Programs 

Not applicable. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Outpatient (e.g., clinic services) and ambulatory 
detoxification. 

Medicaid Mental Health Services 
Remaining Fee-For^Service 



Inpatient; outpatient; mental health rehabilitation 

(e.g., targeted case management); Institution for 
Mental Diseases (IMD) services for individuals age 
65 and over and age 21 and under; mental health 
residential for children under age 2 1 . 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 



Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Not applicable. 

Populations Covered Under Managed 
Behavioral Health 




Not applicable. 

State Managed Care Program 
Administration 



Not applicable. 

Financing of Plans 

Not applicable. 



Coordination Between Primary and 
Behavioral Health Care 

Not applicable, 



July 31, 1998 



169 



Consumer^Family Involvement 

Not applicable. 

Future Plans 



* Nov Program Under Development: A subcommit- 
tee of the Nevada Center for Mental Health 
Services (CMHS) Block Grant Planning Council 
has been created to ensure State mental health and 
consumer participation in the likely evolution of 
behavioral managed care. 

State Agency Administration 

The Medicaid authority is the Medicaid Office, 
which is under the Division of Health Care 
Financing and Policy, Department of Human 
Resources, The mental health authority is the 
Division of Mental Health and Mental Re- 
tardation, housed in the Department of Human 
Services. The substance abuse authority is the 
Bureau of Alcohol and Drug Abuse (BADA), 
which is under the Department of Employment, 
Training, and Rehabilitation. 

Welfare Reform 



Nevada's Temporary Assistance for Needy Families 
(TANF) program went into effect September 30, 
1996, and was certified complete December 24, 
1996. The plan denies TANF benefits to drug 
felons. Effective January 1, 1998, TANF benefits are 
available to those individuals who 1) demonstrate 
they have not possessed, used, or distributed con- 
trolled substances since they began the program, or 
2) are pregnant, and a physician has certified in 
writing the health and safety of mother and unborn 
child are dependent upon the receipt of cash bene- 
fits. The Welfare Division has contracted with 
BADA to provide substance abuse evaluation and 
treatment for all referred TANF recipients. Priority 
is given to pregnant women, teen parents, and indi- 
viduals with more severe concerns. Case managers 



supply BADA with information on the eligible 
TANF client who is referred for assessment/treat- 
ment, such as gender, age, and information relating 
to medical condition, substance used, and frequen- 
cy, among other things. 

When a case manager has reason to believe a 
TANF participant's employability or parenting abil- 
ities may be affected by substance abuse, the case 
manager may refer the participant to a Division 
social worker. The social worker may administer a 
drug test. Eligibility for benefits is not affected sole- 
ly by the outcome of the drug test. If the test pro- 
duces a positive probability regarding substance 
dependence, the participant may be referred for fur- 
ther assessment. Further assessments are adminis- 
tered by a BADA-certified counselor or other quali- 
fied professional, who may refer for laboratory test- 
ing. If the participant refuses further assessment, 
treatment, or testing, the participant may be sanc- 
tioned for lack of cooperation. If tests are ordered 
by a qualified professional, the testing is paid for by 
the Division. 

The State's Wei fare -to -Work plan was submit- 
ted December 12, 1997, and approved January 29, 
1998. Under this plan, $1 million has been allocat- 
ed for substance abuse treatment services. The 
administering agency is the Welfare Division of the 
Department of Human Resources. One hundred 
percent of the matching funds are State dollars for 
fiscal year 1998. Substate allocation of funds is split 
between poor individuals and TANF recipients. 

County 

Not applicable. 

Evaluation Findings 

Not applicable. 

Other Quantitative Data 

Not applicable. 



170 



{SAMHSA} Managed Care Tracking System 



NEW HAM PSH I RE 



OVERVIEW 



New Hampshire has two publicly funded managed care programs. Neither required a the Health 
Care Financing Administration (HCFA) waiver. One is a voluntary health maintenance organization 
(HMO) managed care program covering physical health care and some mental health and substance 
abuse services for Aid to Families with Dependent Children (AFDC) eligible recipients. The 
Department of Health and Human Services (DHHS) has submitted a Section 1115 waiver 
to convert this program to a mandatory one, but this has not been approved yet. A second managed 
care plan is specifically designed for persons with serious mental illness (SMI). Under this plan, com- 
munity mental health centers (CMHCs) are given financial incentives for high performance. 

Managed Care Programs for Behavioral Health Services 

I Medicaid Waivers | 

li I 

Not applicable. 

II Medicaid Voluntary 
New Hampshire Managed Care - general health - integrated: Voluntary program that offers basic 
behavioral health services to AFDC/TANF (Temporary Assistance for Needy Families) recipients. 

11 Other Managed Care Programs 

The New Hampshire Department of Mental Health and Developmental Services (NHDMHDS) - mental 
health stand-alone:The Department has made incremental steps toward managed care by allocating 
contract funds according to the provider's performance on consumer outcome measures. 




Geographic Location 



New Hampshire Managed Care: Statewide. 
NHDMHDS: Statewide. 

Status of Programs 

New Hampshire bAana^ed Care: Submitted: unknown,- 
approved: unknown, implemented March 1983. 
NHDMHDS: Implemented 1992. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 



Acute detoxification (hospital-based only and based 
on medical necessity),- outpatient. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Inpatient,- Institution for Mental Diseases services 
for individuals under age 22 and over age 65; out- 



patient (e.g., clinic services), mental health rehabil- 
itation (e.g., targeted case management). 

Medicaid Substance Abuse Services in 
Managed Care Plan 



New Hampshire Managed Care: Inpatient,- outpatient. 

Medicaid Mental Health Services in 
Managed Care Plan 

New Hampshire Managed Care: Inpatient,- outpatient 
(e.g., therapy); crisis. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

NHDMHDS: Substance abuse services are funded 
under this formula for persons with a dual diagnosis. 



July 31, 1998 



171 



Non-Medicald Mental Health Services in 
Managed Care Plan 



Financing of Plans 



NHDMHDS: All community mental health services 
are funded under this formula. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



New Hampshire Managed Care: Early and periodic 
screening, diagnosis, and treatment (EPSDT) ser- 
vices,- information dissemination on preventive 
health, systematic early identification and interven- 
tion for mental health and substance abuse services,- 
mental health and substance abuse education and 
wellness (e.g., teen mother substance abuse preven- 
tion program, violence prevention programs, identi- 
fication of symptoms of mental health and sub- 
stance abuse). 

NHDMHDS: Not applicable. 

Populations Covered Under Managed 
Behavioral Health 

New Hampshire Managed Care: Voluntary children and 
adults; categorically needy and foster care categori- 
cally needy. 

NHDMHDS: Determined by level of need cri- 
teria (e.g., treatment and rehabilitation to children, 
older adults, and eligible adults,- emergency services 
and eligibility assessment to anyone based on 
need). 

State Managed Care Program 
Administration 



New Hampshire Managed Care: The Medicaid agency 
contracts with one for-profit HMO. The HMO 
either provides behavioral health services itself or 
subcontracts them to CMHCs. 

NHDMHDS: NHDMHDS is using administra- 
tive methodologies to manage the use of public 
funds for adults with SMI. NHDMHDS withholds 
1 to 5 percent of CMHC allocations for a statewide 
pool for performance funding. Performance allo- 
cations are provided to CMHCs that demonstrate 
efficiency, effectiveness, and resource need. Ap- 
proved CMHCs in each of the State's 10 regions 
provide the services. 



New Hampshire Managed Care Medicaid is the source 
of funding. The HMO is paid a capitated rate. 

NHDMHDS: NHDMHDS is part of the State's 
mental health budget allocation. The Department 
reimburses providers based upon their perfor- 
mance on several key indicators including client 
employment, cost per client, and client tenure in 
the community. 

Based on client assessments, all consumers 
served by the agency are classified into one of three 
eligibility categories: severe and persistent mental 
illness, serious mental illness (SMI), and formerly 
severe mental disability. The number of consumers 
within each of these three categories then forms the 
basis for allocation of State funds and use of State 
hospital beds. 

At the beginning of the fiscal year, 
NHDMHDS computes the total State funds allo- 
cated for community-based services for persons 
with SMI in the previous fiscal year. This amount is 
then adjusted based on the availability of funds 
compared with the previous year. Once a total 
amount of available funds is determined, resources 
are factored out to fund existing and new statewide 
efforts, such as a statewide congregate living service 
for elders or statewide training initiatives. 

Of the remaining funds, a selected percentage 
(usually between 95 percent and 99 percent) is used 
for base funding for the 10 local CMHCs,- the other 
1 percent to 5 percent of the available funds is used 
as a statewide pool to allocate to individual agencies 
based on performance on the designated statewide 
indicators. In addition, other new funds may be leg- 
islatively appropriated for development of specific 
initiatives, such as for children or elders. Ideally, 
NHDMHDS tries to reserve a minimum of 5 per- 
cent of the total available funds for "performance 
funding," although this is difficult in times of fund- 
ing deficits. When available funding is limited, the 
Division tries to minimize the impact on the base 
funding by decreasing the size of the performance 
pool without totally eliminating it. 

CMHCs receive performance funding if they 
demonstrate efficiency, effectiveness, or resource 
need. Efficiency is measured by relative cost of 
agency services per weighted client,- effectiveness is 
measured by State hospital use and consumer 



172 



{SAMHSA} Managed Care Tracking System 



employment rates,- and resource need is based on a 
comparison of effectiveness for agencies within the 
same efficiency range. Agencies with a low cost per 
weighted client either may be efficient or may be 
determined to be underfunded if hospital and 
employment outcomes are poor. If all agencies with 
relatively low funding per weighted client are 
achieving relatively poor client outcomes, it is an 
indication that more resources may be needed to 
strengthen the services. There also is an inherent 
assumption that continuous improvement is always 
possible. 

Coordination Between Primary and 
Behavioral Health Care 



New Hampshire Managed Care: When behavioral health 
services are subcontracted, long-term mental health 
services must be coordinated with the State-con- 
tracted CMHCs. 

NHDMHDS: Not applicable. 

Consumer^Family Involvement 

New Hampshire Managed Care: Not applicable. 

NHDMHDS: Consumers and families are repre- 
sented on the State mental health planning council 
and on each of the 10 local planning councils. 

Future Plans 

New Hampshire Managed Care: Once the 1115 waiver is 
approved, this program will be terminated. 

NHDMHDS: The Department's intent is to 
gradually reimburse providers on costs per client 
rather than on a unit cost basis. Currently, average 
costs are based on weighted eligibility category. 

"k New Program Under Development: DHHS sub- 
mitted a Section 1115 waiver to HCFA on June 5, 
1996, that would include some acute mental health 
and substance abuse services. This program would 
convert the voluntary HMO program into a manda- 
tory one. The Department will contract with 
HMOs, preferred provider organizations, commer- 
cial insurers, and nonprofit health service corpora- 
tions, which will be at full risk. Plans will be select- 
ed through a competitive bidding process and paid 



a capitated rate. Plans will be required to contract 
with community health centers, if available, which 
will be paid on a fee-for-service basis. 

State Agency Administration 



The Medicaid authority is the Office of 
Medical Services, within DHHS. The mental health 
authority is the Division of Mental Health and 
Human Services, which also houses the substance 
abuse authority, the Bureau of Substance Abuse 
Services. 

Welfare Reform 

The State's TANF plan, filed with the U.S. DHHS 
on October 1 , 1 996, was determined to be complete 
on November 12, 1996. The plan does not deny 
TANF benefits to drug felons and does not test its 
recipients for drug use. 

On June 18, 1996, the U.S. DHHS approved 
the waiver for New Hampshire's welfare reform 
demonstration project, the New Hampshire 
Employment Program. Substance abuse or mental 
health treatment is an approved "barrier resolution 
activity" for this program. The 5-year, statewide 
project includes mandatory job search and work 
requirements, a family cap, expanded transitional 
assistance, increased resource and asset limits, and 
changes to the earned-income disregard. 

New Hampshire has submitted a Welfare-to- 
Work plan that includes additional activities and 
delivers a seamless system of services. Extra funds 
are being included in the New Hampshire 
Employment Program. 

County 

Not applicable. 

Evaluation Findings 



New Hampshire requires reporting and continuous 
quality improvement reports. 

Other Quantitative Data 

Not applicable. 



July 31, 1998 



173 



NEW JERSEY 



OVERVIEW 



While the State Medicaid, mental health, and substance abuse agencies continue to plan for a behav- 
ioral health carve-out (see Future Plans Section), other managed care programs have been imple- 
mented that affect public sector mental health and substance abuse clients. The State is in the process 
of initiating a voluntary managed care program for disproportionate share hospitals (DSHs). 

Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 

Section 1115- Managed Charity Care Demonstration (MCCD) - integrated: Hospitals that voluntarily 
participate in the program provide limited mental health and substance abuse services to the 
non-Medicaid population. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 
Not applicable. 




Geographic Location 

Section ms -MCCD: Regional. 

Status of Programs 

Section ms -MCCD: Approved February 13, 1998. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 



Inpatient (acute),- outpatient (hospital-based only),- 
opiate treatment. 

Medicaid Mental Health Services 
Remaining Fee-For^Service 

Inpatient; Institution for Mental Diseases (IMD) 
services for individuals under age 21 and over age 
65, outpatient (e.g., clinic services, physician ser- 
vices, partial hospitalization), support (e.g., target- 
ed case management, personal care, supervised 
housing, boarding homes). 



Medicaid Substance Abuse Services in 
Managed Care Plan 

Section ins - MCCD: Inpatient (acute),- outpatient 
(hospital-based only),- opiate treatment. 

Medicaid Mental Health Services in 
Managed Care Plan 

Section iH5 - MCCD: Inpatient,- IMD services for 
individuals under age 2 1 and over age 65; outpatient 
(e.g., clinic services, physician services, partial hos- 
pitalization),- support (e.g., targeted case manage- 
ment, personal care, supervised housing, boarding 
homes). 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 



July 31, 1998 



175 



Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section iiis - MCCD: None. 

Populations Covered Under Managed 
Behavioral Health 



Section ms - MCCD: Voluntary: uninsured (up to 
300 percent Federal poverty level) with substance 
abuse problems or dually diagnosed with mental 
health and substance abuse problems. 

State Managed Care Program 
Administration 



Section iiis - MCCD: The Department of Health and 
Senior Services (DHSS) administers the program. 
DHSS funds 60 hospitals. As a result of legislative 
changes in June 1 998, hospitals now voluntarily par- 
ticipate. Other details are in development. 

DHSS sets guidelines for how hospitals con- 
duct the program and approves the hospitals' man- 
aged care plans and networks. Community sub- 
stance abuse treatment providers at all levels of care 
participate in the network at the hospitals' initiation. 

Financing of Plans 

Section ms - MCCD: DSH funds serve as the major 
funding source for this demonstration. Some dedi- 
cated and some State general funds are blended 
with DSH funds. Hospitals are given a budget and 
placed at risk. There are no risk corridors. Charity 
care budget for each hospital is determined accord- 
ing to a State formula based on previous year chari- 
ty care cost. 

Coordination Between Primary and 
Behavioral Health Care 

Section ms - MCCD: Details under development. 
Consumer^Family Involvement 



Section ms - MCCD: Every hospital is required to 
have a committee, but it is unknown if consumers 
and families will be included. 

Future Plans 



Section ins - MCCD: Implementation schedule to 
be announced. The waiver amendment is antici- 



pated to convert the program to a voluntary 
demonstration. 

* New Program Under Development: The State 
released a request for proposals (RFP) for a 
Substance Abuse Initiative (SAI) on care coordina- 
tion on April 1, 1998. The SAI grant will operate 
from August 1, 1998, until June 30, 1999. New 
Jersey is seeking to secure assessment, utilization 
management, care coordination, and case manage- 
ment services for Work First New Jersey (WFNJ) 
SAI and Substance Abuse Research Demonstration 
(SARD) project. 

The SAI seeks to establish a coordinated, com- 
prehensive continuum of substance abuse services, 
which will be available over the next several years 
to WFNJ recipients. WFNJ recipients are in the 
Temporary Assistance for Needy Families (TANF) 
and general assistance (GA) programs. Substance 
abuse treatment will be integrated along a continu- 
um with work activities so that each can be substi- 
tuted for the other as affected recipients move into 
recovery. The SAI will encompass screening and 
assessment in or near county and municipal welfare 
agencies, utilization management, care coordina- 
tion, treatment, and aftercare. Through the RFP, 
the State will grant one entity which will supply, 
administer, and clinically supervise the work of 21 
or more care coordinators and their assistants. The 
care coordination entity also will supply 10 case 
managers and 10 associate case managers to pro- 
vide five two-person teams in Atlantic and Essex 
Counties for the SARD. The entity chosen is the 
National Council on Alcohol and Drug 
Dependence - New Jersey (NCADD-NJ) Chapter. 
The care coordinators will be employed by 
NCADD-NJ. 

The services purchased through the RFP will 
coordinate the treatment provided by separate 
agencies into one continuum of care based on the 
American Society of Addiction Medicine Patient 
Placement Criteria Second Edition (ASAM PPC-2). 
This continuum of treatment services has been 
secured through a related RFP. The network will 
contain 99 agencies offering 358 programs covering 
all levels of ASAM PPC-2 services. 

Reimbursement for services delivered through 
the care coordination grant will be made monthly 
or quarterly, depending upon the terms in the health 
service grant. 



176 



{SAMHSA} Managed Care Tracking System 



State Agency Administration 



The New Jersey Department of Health houses the 
Division of Alcoholism, Drug Abuse and Addiction 
Services, and the Division of Medical Assistance 
and Health Services (Medicaid). The Department 
of Human Services houses the Division of Mental 
Health and Hospitals. 

Welfare Reform 

A two-site demonstration (SARD) for providing 
substance abuse services to WFNJ clients is in the 
first phase of implementation. Currently, New 
Jersey does not mandate drug testing of its TANF 
clients,- however, it does deny TANF benefits to 
those eligibles convicted of drug-related felonies. A 
consulting firm has been selected to design the 



assessment process and treatment model,- the 
project evaluation will be done by Rutgers 
University. The SARD began October 1998. 

County 

Not applicable. 

Evaluation Findings 

Section Hi5 - MCCD: Hospitals must establish quali- 
ty assurance programs that will monitor access and 
quality of care. 

Other Quantitative Data 

NJ KidCare: As of July 1998, 7,500 children are 
enrolled. 



July 31, 1998 



177 



NEW M EXICO 



OVERVIEW 

New Mexico operates a 1915(b) integrated managed care waiver that covers all medical/surgical and 
specialty health care services, including mental health and substance abuse services for Aid to 
Families with Dependent Children (AFDC) and Supplemental Security Income (SSI) populations 
under a single capitated program called SALUDl, New Mexico Partnership for Wellness and F^ealth. 
The program has a unique "carve-in" feature that requires health plans to identify and partner with 
organizations that specialize in managed behavioral health care. 



Managed Care Programs for Behavioral Health Services 

ll Medicaid Waivers 

i| Section 1915(b) - SALUD! - general health - integrated: Mental health services carved-in through New 

i Mexico Partnership forNA/ellness and Health full-risk capitated program. 

I Medicaid Voluntary 
Ij Not applicable. 

h 

|| Other Managed Care Programs 
Not applicable. 



Geographic Location 

Section i9i5(h] - SALUDl: Statewide 

Status of Programs 



Section 49 {5(b) - SALUDl: Waiver submitted 
Decembers, 1 996,- approved May 13, 1997, imple- 
mented July 1, 1997. Statewide implementation 
complete June 1, 1998. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 



Acute detoxification for adults. Additional inpatient 
and outpatient services for children and adoles- 
cents. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 



Inpatient; outpatient (e.g., clinic services),- rehabili- 
tation (targeted case management). Other residen- 
tial and community-based services for children. 




Medicaid Substance Abuse Services in 
Managed Care Plan 



Section i9i5(b) - SALUDl: Outpatient. Managed care 
organizations (MCOs) are given the option to pro- 
vide further substance abuse treatment for adults as 
enhancement. 

Medicaid Mental Health Services in 
Managed Care Plan 



Section {9 i 5(h) - SALUDL Inpatient, outpatient (e.g., 
clinic services); rehabilitation (targeted case man- 
agement). MCOs are given the option of develop- 
ing enhanced services that meet individuals' needs. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 



Not applicable. 



July 31, 1998 



179 



Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Section i9i5[b] - SALUD!: Substance abuse preven- 
tion services are not offered to adults through 
Ndedicaid managed care contracts. Individualized 
services can be offered as enhanced benefits. Drop- 
in centers operated by consumers are currently 
being developed. 

Populations Covered Under Managed 
Behavioral Health 



Section i9i 5(h) - SALUD!: Children and adults 
mandatory: AFDC, SSI, Medicaid expansion for 
pregnant women and children, Seventh Omnibus 
Budget Reconciliation Act (SOBRA). Native 
Americans have the option of choosing not to enroll 
with an MCO. 

State Managed Care Program 
Administration 

Section i9i5(b) - SALUD!: New Mexico's Medicaid 
agency contracts directly with for-profit health 
maintenance organizations (HMOs), which are at 
full financial risk. HMOs are required to contract 
with behavioral health managed care organiza- 
tions (BHCMOs) and to identify these partners in 
the bidding process. Contracts require delivery of 
a comprehensive, integrated benefit package of 
medical/surgical and specialty health services, 
including behavioral health at a fixed price per 
member per month. HMOs have partnered with 
three for-profit behavioral health organizations. 
BHMCOs contract with community mental health 
centers (CMHCs) and other local providers to 
provide services. 

As the single State Medicaid agency, the 
Medical Assistance Division (MAD) is responsible 
for overall contract management. MAD contracts 
directly with the HMOs. The HMOs are responsi- 
ble for ensuring that the BHMCOs perform their 
contractually required tasks. The BHMCOs con- 
tract with CMHCs and other local providers. 

Financing of Plans 

Section i9i5(h) - SALUD!: The source of funds is 
Medicaid dollars. HMOs are paid a single capita- 
tion rate. HMOs are at full financial risk. Capitation 
rates are based on an actuarial analysis of old fee- 



for-service claims data. TTie BHMCOs are subcapi- 
tated. Payment to CMHCs is a combination of per 
diems and fee-for-service, which varies by center 
and BHMCO. 

Coordination Between Primary and 
Behavioral Health Care 



Section i9i5[b) - SALUD!: The contract with MAD 
requires coordination,- behavioral health providers 
are required to communicate with clients' primary 
care providers. Primary care providers are required 
to provide summaries of lab work, medications, 
physical medicine issues, among other things, to 
behavioral health providers. 

Consumer-Family Involvement 



Section i9i5(h) - SALUD!: In collaboration with the 
Departments of Health, and Children, Youth, and 
Families, the Human Services Department held 
public forums statewide and met with advocacy 
groups to discuss the framework of the managed 
care model. A preprocurement conference was then 
held in September 1996 to discuss responses sub- 
mitted by the public advocacy groups and potential 
managed care providers to draft a policy and quali- 
ty standards document. At this conference, the 
State allowed those in attendance (more than 300 
individuals) to make public comments for consider- 
ation by the State in developing the policy, quality 
standards, request for proposal, and 1915 waiver. 
Input received at that conference and subsequent 
community and advocacy group meetings were 
considered in the development of the current direc- 
tion of the Medicaid managed care program. 

HMOs contract with consumer and advocate 
organizations to provide education on HMO health 
systems and to facilitate enrollment and access to 
services. Consumers and guardians participate in 
consumer advisory boards. One BHMCO is in the 
process of organizing/funding a drop-in center 
operated by consumers. 

Future Plans 

Section i9{5[h) - SALUD!: Future plans include 
expansion of the children's health initiative com- 
bined with extensive outreach to increase the num- 
ber of children participating in the program. 



180 



{SAMHSA} Managed Care Tracking System 



* New Program Under Development: New Mexico is 
beginning the process of designing a behavioral 
health managed care program funded by State 
dollars. 

State Agency Administration 



The Medicaid authority in New Mexico is MAD, 
within the Department of Human Services. The 
mental health authority is the Division of Mental 
Health. The substance abuse authority is the 
Division of Substance Abuse. Both are housed with- 
in the Department of Health. 

Welfare Reform 

The State's Temporary Assistance for Needy 
Families plan went into effect July 1 , 1 997. The plan 



stipulates denying benefits to drug felons but does 
not test recipients for drug use. 

County 

Not applicable. 

Evaluation Findings 



An external quality review contractor is beginning a 
review of the project. 

Other Quantitative Data 



Encounter data is required. Quarterly reports on 
utilization of specific services, on-site assessments, 
and review of case management processes have 
begun and will be continued. 



July 31, 1998 



181 



N EW YORK 



OVERVIEW 

New York State's primary managed care initiative, an 1115 waiver program referred to as The 
Partnership Plan, is being implemented by the New York State Department of Health, the Office of 
Mental Health (OMH), and the Office of Alcoholism and Substance Abuse Services, Mandatory 
enrollment of Medicaid-eligible groups into basic health plans is occurring on a phase-in basis. The 
basic plans provide general health care benefits and limited mental health and substance abuse ser- 
vices. Upon certification by the Health Care Financing Administration (HCFA) of Special Needs 
Plans (SNPs), a mandatory phase of enrollment for adults with severe and persistent mental illness 
(SPMl) and children with severe emotional disturbance (SED) will occur in those counties where 
SNPs are located. There are exceptions to the mandatory enrollment in The Partnership Plan, 
Exceptions, based on certain criteria, include individuals whose participation would remain voluntary 
(i,e,, exempt) and individuals who are excluded from participation in The Partnership Plan, 

The State is also planning to develop an extended beneht package for Alcohol and Other 
Dependency (AOD) services, beyond the basic benefit plan coverage. The extended benefit pack- 
age would be reimbursed on a fee-for-service (FFS) basis. 

The Office of Alcoholism and Substance Abuse Services (OASAS) is operating several county- 
based demonstration programs using all sources of government funding including Federal, State, and 
local dollars as well as all income sources, to determine the best way to organize and deliver AOD 
services under managed care arrangements. 

Also, the OMH is operating a managed care initiative for mental health services provided in 
State-operated facilities. 

Managed Care Programs for Behavioral Health Services 




i 



Medicaid Waivers 

Section 1115 -The Partnership Plan - partial carve-out: Integrates basic mental health and substance 
abuse servicesThe SNPs carve out mental health services for those individuals who exhaust the 
basic benefits. Substance abuse services are available for enrollees of mainstream plans. 

Medicaid Voluntary 
None. 

Other Managed Care Programs 

The Prepaid Mental Health Plan (PMHP) - mental health stand-alone: Mental health services provided in 
State-operated facilities; not established under a waiver; established as a health plan pursuant to 
Section 36A of the New York State Social Services Law. 

County Den)onstration Application on the Provision of Managed Addiction Treatment Services - substance- 
abuse stand-alone: OASAS developed plans for three or more time-limited demonstration pro- 
grams. The demonstrations involve coordinated support from OASAS and State departments of 
health and social services to test and evaluate new methods or arrangements for organizing, financ- 
ing, staffing, and providing services in order to determine the desirability of such methods 
and arrangements. 



July 31, 1998 183 



Geographic Location 



Section ms - The Partnership Plan-. Basic health plans 
are being phased in on a county-specific basis (cur- 
rently implemented in 1 1 counties). SNPs for men- 
tal health services will be implemented in the future 
on a county-specific or regional county-consortia 
basis. 

The PMHP: Statewide. 

County Demonstration Application on the Provision oj 
Managed Addiction Treatment Services: Erie and Albany 
counties. 



Status of Programs 



Section iiis - The Partnership Plan: Submitted waiver 
March 20, 1995,- waiver approved July \5, 1997. 
Draft request for proposal (RFP) for adults with seri- 
ous mental illness released September 1997,- final 
RFP for adult SNP anticipated late fall 1998 and 
contracts to be signed early 1999. Children's request 
for information (RFI) released April 29, 1998. 
Comments being analyzed and incorporated into 
final design of children's SNP program. 

PMHP: Implementation April 1, 1996. 

County Demonstration Application on the Provision of 
Managed Addiction Treatment Services: Phase 1 implemen- 
tation October 1, 1997. Formal approval has been 
given to two of the four Phase I counties. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Opiate treatment; outpatient (e.g., alcohol rehabili- 
tation),- inpatient (e.g., services provided by section 
number 1035 facilities). 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Rehabilitation (e.g., day treatment for children and 
adolescents, partial hospitalization for adults, 
continuing day treatment for adults, intensive psy- 
chiatric treatment), support (e.g., intensive case 
management). 

Medicaid Substance Abuse Services in 
Managed Care Plan 



benefit), outpatient (up to 60 visits). These services 
are not included in the basic health plan benefit 
package for Supplemental Security Income (SSI) 
recipients. 

Medicaid Mental Health Services in 
Managed Care Plan 



Section i i iS - Partnership Plan: The basic benefit pack- 
age includes acute detoxification, inpatient (up to 
30 days,- combined substance abuse/mental health 



Section iiiS - Partnership Plan: The basic benefit pack- 
age includes inpatient (up to 30 days,- combined 
substance abuse/mental health benefit), outpatient 
(up to 20 visits). These services are not included 
in the basic health plan benefit package for SSI 
recipients. 

The SNPs package for adults includes crisis ser- 
vices, rehabilitation, support (e.g., service coordina- 
tion, self-help, and empowerment),- inpatient,- out- 
patient. 

For children: Support (e.g., service coordina- 
tion),- crisis,- inpatient; outpatient. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

PMHP: Not applicable. 

County Demonstration Application on the Provision of 
Managed Addiction Treatment Services: All substance 
abuse treatment services as described by participat- 
ing counties. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

PMHP: Mental health support (e.g., outreach, social 
training, socialization, supportive skills training, 
personal services, assessment, case management, 
clinical support, treatment planning, discharge 
planning, clinical support); crisis (e.g., intervention, 
respite, in-home support, psychiatric consultation); 
rehabilitation (e.g., psychiatric functional assess- 
ment, goal setting, service planning, resource devel- 
opment); inpatient; outpatient. 

County Demonstration Application on the Provision of 
Managed Addiction Treatment Services: Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section ms -The Partnership Plan: Basic health plans 
are required to do the following: develop policies 
and procedures to ensure that all network primary 
care providers routinely screen for mental health 



184 



{SAMHSA} Managed Care Tracking System 



and substance abuse programs,- conduct formalized 
health screening to assess any behavioral health ser- 
vice needs of members,- establish mechanisms to 
assess individuals at risk, provide outreach, and 
arrange for evaluations of their needs,- adopt prac- 
tice guidelines consistent with current standards of 
care,- and ensure that members receive follow-up 
services from appropriate providers based on the 
findings of their assessment instruments. 

PMHP: Personal support, self-help support, case 
management, education, health screening, and 
referral. 

County Demonstration Application on the Provision oj 
Managed Addiction Treatment Services-. Counties may 
choose to provide supportive services beyond the 
spectrum of approved substance abuse services. 
Support may include educational activities related 
to prevention of future substance abuse by demon- 
stration project participants. 

Populations Covered Under Managed 
Behavioral Health 

Section iH5 - The Partnership Plan: Adults and children 
mandatory: Aid to Families with Dependent 
ChildrenATemporary Assistance for Needy Families 
(AFDCATANF), Home Relief (Safety Net popula- 
tion), and Medicaid-only recipients who reside in 
participating counties. SSI voluntary (see Future 
Plans Section). 

Mental Health SNPs: See Future Plans Section. 

PMHP: Voluntary adults and children: 
AFDC/TANF, SSI, individuals receiving inpatient, 
outpatient, or community support program (CSP) 
services at an Office of Mental FHealth (OMH) 
Adult Psychiatric Center, individuals currently not 
receiving licensed services at a non-State-operated 
program, individuals who meet the inpatient (ages 
18-21 and over age 65) criteria and individuals who 
meet the outpatient criteria (over age 18). 

County Demonstration Application on the Provision oj 
Managed Addiction Treatment Services: Substance abuse 
clients. Additional covered populations depend on 
county initiatives. 

State Managed Care Program 
Administration 



Section ms - The Partnership Plan: 

Basic Plan: The Department of Health (DOH) 
qualifies managed care organizations (MCOs) 



and prepaid health plans (e.g., Medicaid-only 
MCOs) to participate in Medicaid managed care 
programs. 

The MCOs bid on a county or borough basis. 
Each bidder is required to address two separate 
areas: programmatic ability to serve the Medicaid 
population (technical proposal) and cost. Plans are 
encouraged to use community-based providers. 

in evaluations of programmatic proposals, spe- 
cial weight is given to plans whose networks include 
linkages with community providers that have tradi- 
tionally served the poor and uninsured, such as 
community health centers, federally qualified health 
centers, and school-based clinics. 

Mental Health SNPs: The State expects to 
finalize the RFP for the adult mental health SNP in 
late fall 1998 and to execute contracts in early 1999 
(see Future Plans Section). Under the SNPs, OMH 
and DOH provide joint certification, standards, rate 
setting, regulation, and oversight of the plans. Ap- 
plicants for the plans can be any combination of 
persons, natural or corporate, including a county or 
counties. 

AOD: Currently, participating MCO network 
providers (participating in a qualified partnership 
plan) submit claims to the MCO and the MCO 
reimburses the network providers at negotiated 
rates when 

• an annual evaluation visit is requested by the 
patient (e.g., sel f- referral ),- 

• assessment and treatment services have been 
ordered by the MCO, primary care provider, or 
other provider authorized by the MCO, 

• assessment and treatment services are mandated 
by a court of competent jurisdiction. Network 
providers submit claims to the MCO, and the 
MCO reimburses network providers at negoti- 
ated rates. MCOs must reimburse non-network 
providers of court-ordered services at Medicaid 
rates,- and 

• the annual base benefit alcohol and chemical 
dependence services include up to 30 days of 
inpatient care and up to 60 outpatient visits for 
alcohol and chemical dependence treatment 
service. 

PMHP: The purpose of this program is to pro- 
vide an array of mental health services that best 
meet the needs of the recipient. State psychiatric 
centers serve as the managed care networks. None 



July 31, 1998 



I8S 



have contracts with other providers. OMH main- 
tains oversight authority. 

County Demonstration Application on the Provision of 
Managed Addiction Treatment Services: OASAS and 
counties are partners in the goal of developing 
more innovative and effective approaches to deliv- 
ering, to a targeted population, cost-effective 
addiction treatment services, health care, and social 
services in an effort to help clients achieve self- 
sufficiency. 

Under State law, OASAS formally contracts 
with county governments for the provision of sub- 
stance abuse services to meet their specific needs. 
County governments may provide services directly 
or contract with local providers for the delivery of 
services. The County Demonstration Project allows 
counties to apply management concepts and princi- 
ples, which may include screening, assessment, 
referral, case monitoring, and different levels of case 
management, to specifically defined populations. 
Inherent in the demonstration is an evaluation com- 
ponent that will measure the effectiveness of coun- 
ty designs and ultimately assist OASAS in the devel- 
opment of a statewide model. 

Financing of Plans 

Section ms - Partnership Plan: This program is 
financed through Medicaid and State-only dollars. 
Under the Partnership Plan, MCOs are fully capi- 
tated and at risk. New York uses a bid and negotia- 
tion process for purposes of contracting with plans. 
The final contract rates negotiated must fall within 
rate ranges developed by actuaries who are under 
contract with the State. Actuaries use an FFS 
Medicaid claims database for developing FFS-equiv- 
alent rates that are trended forward to the current 
year. Rates are also adjusted for the impact of man- 
aged care on utilization and cost converted into 
ranges of acceptable rates. Savings were built into 
the capitation rate. Plans are required to be rein- 
sured against insolvency,- the state offers stop-loss 
coverage for this. 

Mental FHealth SNPs: SNP contractors will be 
paid on a fully capitated basis with one possible 
exception: Rural counties electing to participate in 
the program may propose an alternative payment 
structure including, but not limited to, a partial cap- 
itation structure, subject to the approval of the 
State. The final RFP will be county specific and 



define the scope of the capitation payments and 
the payment levels. 

A strong focus on the outcomes of care will be 
a major component of the SNP initiative. The State 
will use financial incentives to encourage appropri- 
ate levels of performance. Each year, the State will 
withhold a portion of the capitation payment in the 
range of 1 to 3 percent for performance incentives. 
The State, in conjunction with the localities, will 
identify annually one or more performance targets 
in key outcome areas of SNP performance. A SNP 
can recoup the withheld funds only by meeting or 
exceeding the performance targets. 

Plans will not be responsible for the cost of 
inpatient expenses in excess of $100,000. Plans will 
continue to be responsible for managing and financ- 
ing care but will be able to submit vouchers for FFS 
reimbursement for 85 percent of the cost of inpa- 
tient claims in excess of the $100,000 individual 
stop-loss limit. 

Plans will have to demonstrate sufficient capital 
to fimd development and preoperational costs, 
accumulated losses through break-even, and an 
allowance for contingencies. Each SNP will be 
required to demonstrate adequate capitalization to 
ensure the financial viability of the plan and must 
also establish a 5 percent statutory escrow reserve 
fund. Plans will be required to share gains with the 
State. Gain-sharing requirements will be deter- 
mined on an annual basis. 

PMHP: This program is a partially capitated 
Medicaid initiative. Capitation rates were deter- 
mined based on historic Medicaid expenditures for 
services. 

County Demonstration Application on the Provision of 
Managed Addiction Treatment Services: This program is 
financed through all sources of government fund- 
ing, including Federal, State and local dollars as well 
as all income sources. Providers will continue to be 
paid on either an FFS basis or net deficit contracts. 
At this time, providers assume no risk,- however, one 
aspect of the demonstration is to explore alternate 
means of financing. 

Coordination Between Primary and 
Behavioral Health Care 



Section ms - The Partnership Plan: Individuals enrolled 
in the SNP for their mental health services will be 
co-enrolled in a health plan for their physical health 



186 



{SAMHSA} Managed Care Tracking System 



services. Formal linkages will be critical to ensure 
the coordination of care. Agreements will be exe- 
cuted between the SNP and these organizations. 

PMHP: Not applicable. 

County Demonstration Application on the Provision of 
Managed Addiction Treatment Services: Under this pro- 
gram, MCOs will continue to provide physical 
health care services under their capitated rate. 

Consumer-Family Involvement 



Section ms - The Partnership Plan-. The Medicaid 
Managed Care Advisory Council's Consumer 
Education Subcommittee was charged with the 
responsibility of ensuring that Medicaid clients are 
guaranteed accurate managed care information 
about issues such as service access and accessibili- 
ty,- grievance procedures, clients' bill of rights,- how 
to choose the right plan,- special needs concerns 
and processes,- and enrollment and disenrollment 
procedures. 

Mental Health SNPs: The Medicaid Managed 
Care Advisory Council's Mental Health 
Subcommittee met for 9 months. The 
Subcommittee was composed of a wide range of 
constituent representatives (e.g., recipients, fami- 
lies, providers, advocates, administrators) and was 
charged with developing recommendations for 
adult and children mental health SNPs. Since that 
time, the state has held many public meetings to 
discuss progress on program design and feedback. 

Additionally, an advisory group, composed of 
members of various previous New York State Office 
of Children's Health subcommittees was formed to 
review 

• the contents of the children's SNP RFI,- 

• the responses that are received during the pub- 
lic comment process,- and 

• the implications of that information for future 
children's SNP planning. 

PMHP: Self-help is one of the five service cate- 
gories in PMHP. Facilities are working with recipi- 
ents to expand all help opportunities. Also, recipi- 
ents serve as enrollment counselors for prospective 
enrollees. 

County Demonstration Application on the Provision oj 
Managed Addiction Treatment Services: The County 
Demonstration Project requires, as part of the appli- 
cation process, a signed assurance regarding public 



participation and plan dispute resolution. This 
assurance addresses the participation of local addic- 
tion providers, local social service providers, con- 
sumers, consumer groups, advocacy groups, and 
other local parties during the application process 
and throughout the course of the demonstration 
period. 

Future Plans 



Section ms - Partnership Plan: Regional phase-in of 
mandatory enrollment of AFDC/TANF and Home 
Relief (HR) populations will be statewide in approx- 
imately 3 years. SSI will be mandatorily enrolled 
when program features and rates are established. 
HCFA has stated that SSI can become mandatory m 
each region no sooner than 1 year after mandatory 
enrollment of TANF/HR, and only after certain 
milestones are achieved. 

Currently, the inpatient limit for any combina- 
tion of mental health and substance abuse services is 
30 days. When the program features and systems 
capabilities are developed, this will change to 30 
inpatient days for substance abuse services only, and 
the outpatient limit will change from 60 visits to 20 
visits (e.g., benefit limit package). 

Mental Health SNPs: Call letters have been 
issued to the counties, inviting individual counties 
or consortia of counties to submit a Letter of Intent 
as to their interest in having one or more SNPs sited 
in their county or counties. Letters of Intent were 
received from five geographic regions. 

In the future, as SNPs are certified by HCFA, 
SPMI adults and SED children will be able to 
choose to obtain mental health services through a 
basic health plan or an SNP. Participation in SNPs 
would be limited to individuals who meet the defi- 
nition of SPMI or SED (FFS exception: SPMI adults 
and SED children could continue to access mental 
health services on an FFS basis if they reside in a 
county that offers no SNP services, or in a county 
that offers only a county-operated SNP). 

* New Pro()ram Under DevelopmetU: In the rest of 
the State, two possible regional SNPs have 
emerged: one for a lO-county region and one for a 
19-county region. Other possible SNPs include one 
for Long Island and one covering Westchester 
County and other counties north of New York City. 

* New Program Under Developmoit: An RFI was 
released in April 1998 for a children's SNP. This pro- 



July 31, 1998 



187 



gram will serve those Medicaid-eligibles under age 
18, on a voluntary basis, who meet diagnostic and 
utilization criteria. 

PAIHP. Services in an outpatient setting are 
expected to continue through 1998/2000. 
Continuation of PMHP beyond that has not been 
determined. 

County Demonstration Application on the Provision oj 
Managed Addiction Treatment Services: There is a Phase II 
round of applications with eight additional counties 
showing interest through the formal application 
process. OASAS staff are working to further devel- 
op proposals for implementation later in the year, in 
addition to the remaining Phase I counties. 

State Agency Administration 

The Medicaid, Mental Health, and Substance 
Abuse agencies are housed under three separate 
agencies: the Department of Health, OMH, and 
OASAS, respectively. 

Welfare Reform 

One of New York's Works Programs (part of welfare 
reform) is the Article VII Safety Net Program. This 
program provides temporary aid but no cash assis- 
tance. Persons eligible for the Safety Net include 
qualified aliens who enter the country on or after 
August 22, 1996, families who are ineligible for 
Family Assistance because of time-limit expirations, 
persons whose mental or physical impairment con- 
sists of substance abuse, and needy persons who do 
not reside with children. Those who are able to 
work will be required to participate in workfare and 
other employment services supervised by the 
Department of Labor. 

The program requires that local social services 
departments, when there are reasonable grounds to 
believe that substance abuse is a material cause of 
economic dependency or a barrier to employment, 
enroll the applicant/recipient in a State-licensed or 
certified rehabilitation program, when available. 
Investigation into the cause of an applicant's condi- 
tion shall include drug testing to assist in determin- 
ing if habitual and unlawful use of drugs is a cause of 
economic dependency or a barrier to employment. 
If an applicant tests positive for drugs, he or she will 
be retested prior to payment of assistance or as soon 
thereafter as is practical. If the applicant is found to 
have continued to use drugs unlawfully, assistance 



to the household will be limited to the Safety Net. 
Failure to submit to testing will result in denial of 
assistance to the family. Periodic drug testing will be 
conducted with respect to recertifications of recipi- 
ents for eligibility for public assistance,- assistance to 
the households of persons found to be unlawfully 
using drugs will be limited to Safety Net assistance 
under a social services plan approved by the State 
Department of Social Services. 

MCOs participating in The Partnership Plan 
are not responsible for the provision and payment 
of substance abuse treatment services provided to 
Medicaid managed care enrollees who have been 
mandated by the local department of social services 
to receive substance abuse services as a condition of 
eligibility for public assistance or Medicaid as a 
result of welfare reform. District-mandated welfare 
reform substance abuse services that are approved 
by the Office of Alcoholism and Substance Abuse 
Services, covered by Medicaid, and provided by a 
Medicaid-enrolled provider will be reimbursed on 
an FFS basis. Currently, this policy applies only to 
those individuals determined to have a substance 
abuse problem that is a material cause of economic 
dependency or a barrier to employment. 

County 

Not applicable. 

Evaluation Findings 

Section ms - Partnership Plan: SNPs in the first year of 
the program must use State-defined algorithms to 
quantify performance in seven broad categories: ser- 
vice access, service appropriateness, administrative 
efficiency, enrollee wellness, enrollee ability, 
enrollee social integration, and prevention. 

• OASAS is in the process of implementing Phase 
IV of the Treatment Outcome Study, which has 
entailed a 3-year, four-phase process designed 
to evaluate the delivery of public alcoholism 
and drug abuse treatment services. The first of 
three phases focused on measuring the efficien- 
cy and effectiveness of treatment services and 
served as the foundation of the study. Phase IV 
will: 

>• Examine the relationship between types 
and intensity of services and client out- 
comes,- 



188 



{SAMHSA} Managed Care Tracking System 



>* Assess the effectiveness of different types of 

programs in producing positive outcomes in 

clients with similar presenting problems,- and 

>^ Examine cost-benefit ratios of the New 

York drug and alcohol treatment system. 
Preliminary data suggest immediate results 
from treatment, it is anticipated that most of the 
data will be available within 3 years. The first 
report, which will not require complete data sub- 
mission, will address the relationships between ser- 
vices received and retention and discharge status 
and will probably be available in the fall of 1999. 
Smaller, focused outcome studies will be imple- 
mented in the future to address issues raised in the 
Treatment Outcome Study, or other issues of sig- 
nificance to OASAS (e.g., outcome of clients in 
Women and Children Programs, outcome of man- 
aged care clients). Much will depend on the avail- 
ability of funds. An application is pending with 
CSAT for a Treatment Outcomes and Performance 
Pilot Studies II (TOPPS II) grant to examine the 



relationship between outcome and performance 
measures. 

Other Quantitative Data 

There are currendy 628,025 Medicaid beneficiaries 
(29.1 percent of total eligibles) enrolled in 37 
Medicaid managed care plans throughout New York 
State (data current as of May 1998). 

The 12 provider-sponsored plans operating in 
New York City now serve more than half (56.4 per- 
cent or 219,467) of all enrollees. Statewide, 17 
provider-sponsored plans serve 47.8 percent of all 
enrollees, some 299,964 individuals. 

The Department of Health's Office of Managed 
Care maintains reports on managed care enrollment 
data and participating plans. The data change on a 
monthly basis. Interested parties can request quanti- 
tative information regarding managed care enroll- 
ments and from the Department of Health. 



July 31, 1998 



189 



NORTH C AROLI N A 



OVERVIEW 



Carolina Alternatives is North Carolina's single publicly operated behavioral health managed care 
program for Medicaid recipients. For nonpsychiatric care, Medicaid recipients participate in one of 
several primary health managed care programs. 

Carolina Alternatives is a Medicaid waiver program that operates under the authority of Section 
1915(b) of the Social Security Act. Carolina Alternatives is a publicly operated managed care pro- 
gram that provides mental health and substance abuse benefits to children and adolescents who are 
certified for Medicaid in a county that participates in the waiver. Carolina Alternatives operates on 
the local level through 10 area programs serving the 32 counties participating in the waiver A waiv- 
er renewal application is currently being reviewed by the Health Care Financing Administration 
(F4CFA) to allow continuation of the waiver in the current sites. Plans are to expand the waiver 
statewide to serve all Medicaid-eligible children and adults,- however, a specific timetable for expan- 
sion has not been set. 

Managed Care Programs for Behavioral Health Services 



r 




Medicaid Waivers 

Section 1915(b) - Carolina Alternatives - behavioral health stand-alone: Covers mental health and 
substance abuse services for children and adolescents (ages to 18 years) on a capitated basis. 
Area Mental Health Centers are the portal of entry for services. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 
Not applicable. 



Geographic Location 



Section i9i5[b) - Carolina Alternatives: Currendy serv- 
ing 32 out of 100 counties. 

Status of Programs 



Section i9i5[b] - Carolina Alternatives: Submitted in 
March 1993, approved December 17, 1993, imple- 
mented January 1, 1994. Waiver was renewed in 
December 1995. A second waiver renewal applica- 
tion, submitted in May 1998, is currently being 
reviewed by HCFA, 



Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Acute detoxification,- opiate treatment programs,- 
outpatient (e.g., substance abuse day treatment),- 
inpatient, crisis. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 



Inpatient; outpatient (e.g., clinic services, case man- 
agement, screening and evaluations, client behavior 
intervention, high risk intervention),- Institution for 
Mental Diseases (IMD) services for individuals 
under age 21 and over age 65. 



July 31, 1998 



191 



Medicaid Substance Abuse Services in 
Managed Care Plan 



Section i9i5[b] - Carolina Alternatives: Detoxification,- 
outpatient (day treatment); inpatient for individuals 
under age 21; crisis (e.g., client behavior interven- 
tion, facility-based crisis, high-risk intervention). 

Medicaid Mental Health Services in 
Managed Care Plan 



Section i9i5(b] - Carolina Alternatives: Inpatient,- outpa- 
tient (e.g., case consultation, screening and evalua- 
tion, individual and group clinical services, partial 
hospitalization, day treatment, psychosocial reha- 
bilitation, case management, assertive community 
treatment teams),- crisis (e.g., client behavior inter- 
vention, facility-based crisis, high-risk interven- 
tion),- IMD services for individuals under age 2 1 and 
over age 65. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 



Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section i9i5(b] - Carolina Alternatives: High-risk inter- 
vention (HRI) and client behavioral intervention 
(CBI) services include early treatment, psychoedu- 
cation, and recreational activities designed to inter- 
vene in or reduce disability or dysfunctioning. Early 
intervention and treatment services also include 
education/training to the primary caregivers (e.g., 
family members, teachers). Services of this type are 
traditionally described as "secondary" prevention 
services. HRI and CBI services may be provided at 
any location. Carolina Alternative sites have devel- 
oped the capacity to provide wraparound services to 
children or youth who, because of early symptoms 
or environmental factors, are at risk of developing 
mental health, substance abuse, or developmental 
problems, or are at risk of increasing the degree of 
their problems. 



Populations Covered Under Managed 
Behavioral Health 

Section i9i5(b) - Carolina Alternatives: Children manda- 
tory: Aid to Families with Dependent Children/ 
Temporary Assistance for Needy Families (AFDC/ 
TANF), Seventh Omnibus Budget Reconciliation 
Act (SOBRA) (e.g., Medicaid to infants and chil- 
dren, pregnant women), supplemental security 
income (e.g., disabled, blind). Tide IV-E Adoption 
Subsidy/Foster Care, Foster Care-Non Title IV-E 
Foster Care. 

State Managed Care Program 
Administration 

Section i9i5(b] - Carolina Alternatives: The Division of 
Medical Assistance has established an Memoran- 
dum of Agreement with the Division of Mental 
Health/Developmental Disabilities/Substance 
Abuse Services (DMH/DD/SAS), which contracts 
with qualified nonprofit area MH/DD/SAS pro- 
grams (Area Authorities) to carry out the local coor- 
dination, delivery, and fiscal management of cov- 
ered mental health and substance abuse services for 
eligible Medicaid recipients. Area Authorities may 
consist of a single county or multiple counties. Area 
Authorities are governed by an Area Board appoint- 
ed by the County Commission in each of the coun- 
ties included. They are mandated to oversee and 
coordinate behavioral health services, are at full risk, 
and are paid a capitated fee. Area Authorities pay 
providers directly for services rendered. Any inter- 
ested and qualified provider is permitted to partici- 
pate in the program. 

New organizational entities have been devel- 
oped to assist Area Authorities with their roles as 
managed care organizations (MCOs). These enti- 
ties will be reviewed by DMH/DD/SAS as contract 
agencies if they provide services under contract to 
Area Authorities. Providers are reimbursed accord- 
ing to the rates negotiated in their contract with the 
area program. Implementation of Carolina Alter- 
natives has enabled certain mental health practi- 
tioners (e.g., psychologists, social workers) who 
cannot bill Medicaid directly to be reimbursed for 
their services by participating in the Carolina 
Alternatives provider network. 

The area program is the local MCO with direct 
responsibility for local implementation of the waiv- 
er. A statewide administrative services organization 



192 



{SAMHSA} Managed Care Tracking System 



(ASO) has been brought in to help Area Authorities 
attain economy of scale in carrying out certain man- 
aged care functions. Plans are for the ASO to per- 
form credentialing and privileging, claims process- 
ing, and analysis of utilization data. These plans are 
still under review and have not been formalized yet. 

Financing of Plans 

Section i9i5(b] - Carolina Alternatives: The Area 
Authorities function as the MCOs for the county or 
region that each one serves. As of January 1, 1996, 
the 10 participating Area Authorities have been at 
full financial risk for both inpatient and outpatient 
services for enrollees. Area Authorities receive a 
capitated rate for each eligible child. The original 
capitation rates were based on historical use of inpa- 
tient services and an estimate of outpatient services. 
The rates used for 1997 were calculated from data 
collected from the first 2 years of implementation 
with adjustments made to meet cost-effectiveness 
requirements and adjustments toward a statewide 
mean rate. The rate of payment is that rate negoti- 
ated in the subcontract except in the following 
cases: 1 ) where emergencies or authorized referrals 
to out-of-area or nonaffiliated providers occur, the 
Area Authority shall be liable for payment only to 
the amount paid by Medicaid to fee-for-service 
(FFS) providers, and 2) in the case of the transition 
from FFS to contracted service, the provider has the 
responsibility to follow the Transition of Services 
guidelines,- the Area Authority will then be respon- 
sible for payments (at the Medicaid rate) to 
Medicaid providers for enrollees in pre-existing ser- 
vices until the Area Authority has either defined a 
transfer plan or negotiated different payment 
arrangements. The capitation has been set by 
MH/DD/SAS at a rate lower than the FFS equiva- 
lent. New capitation rates for continuation of the 
waiver have not been set. 

Coordination Between Primary and 
Behavioral Health Care 



Section i9i5[b) - Carolina Alternatives: Medical histories 
are required as part of any client's initial assessment 
for service needs. Care planning teams and case 
managers are encouraged to work with primary care 
providers (PCPs) to ensure coordinated services. 
Expanded provider networks include psychologists 
and social workers who share offices with PCPs, 



providing continuity for children whose health 
needs are met in the same office. Special attention 
has been given to coordination of the Carolina 
Alternatives waiver with the primary care through 
participation in workshops and conferences and the 
development of publications explaining the inter- 
face of Carolina Alternatives with various target 
groups (e.g., public health social workers), the 
Work First welfare reform initiatives, and the 
Medicaid primary care waiver programs. 

Consumer-Family Involvement 

Section {9i5(h] - Carolina Alternatives: Area Authorities' 
approaches to integrating consumer and family 
views have been varied. Approaches taken by Area 
Authorities include 1 ) establishing interagency "pre- 
vention" review committees with community 
involvement; 2) involving community members in 
interagency communication plans to improve wrap- 
around services,- 3) publishing and distributing 
monthly newsletters,- 4) establishing the Carolina 
Alternatives Policy Advisory Committee (CAPAC), 
a group of stakeholders who advise the Division on 
policy matters. Groups throughout the State, repre- 
senting various consumer groups, advocacy groups, 
providers, and professional associations, participate 
in CAPAC. Formation of CAPAC in 1996 was a sig- 
nificant turning point in the State's public sector 
program. CAPAC developed a set of working prin- 
ciples concerning the manner in which civil dis- 
course and policy making should occur. Consumers 
have affected several very difficult policy areas. 
CAPAC consumers helped draft a consumer 
brochure, copies of which are distributed to all 
Medicaid enrollees in participating Carolina 
Alternatives counties. CAPAC consumers helped 
draft an updated appeal policy and set of guiding 
principles assuring consumers of their Federal fair 
hearing rights. Consumer groups actively partici- 
pated in the implementation of the appeal policy. 
Groups attended an appeal training session, con- 
vened by the Division, with area program staff 
Consumer groups staff toll-free support lines and 
field questions about Carolina Alternatives appeal 
policy and the program in general. Consumers also 
helped CAPAC develop a policy requiring area 
programs to offer consumers a choice of ser\'ice 
providers in the Carolina Alternatives area program 
networks. Recently, consumers participated in draft- 



July 31, 1998 



193 



ing the Carolina Alternatives Adult Levels of Care 
Criteria. Their participation in this technical docu- 
ment reflects the exceptional commitment and per- 
severance of North Carolina consumers. This part- 
nership is essential to giving consumers a voice. 

Future Plans 

Section i9i5[b] - Carolina Alternatives: An application 
for continuation of the Carolina Alternatives in the 
current sites is currently being reviewed by HCFA. 
The State eventually plans to phase in Carolina 
Alternatives and expand the waiver to include 
adults. A timetable for expansion and adult imple- 
mentation has not been set. 

State Agency Administration 



Evaluation Findings 



The Department of Health and Human Services 
houses the Medicaid authority (the Division of 
Medical Assistance) and the mental health and sub- 
stance abuse authority (DMH/DD/SAS). 

Welfare Reform 

TTie State's TANF program became effective on 
January 1, 1997. The program stipulates denying 
benefits to certain drug felons and allows for the test- 
ing of recipients for drug use. The program is based 
on the statewide welfare reform initiative that has 
been operating since June 1995 and was strength- 
ened by waivers in 1996. The State's TANF program 
is called Work First. Three provisions for substance 
abuse are the following: providing early childhood 
services when substance abuse is identified to ensure 
the healthy development of children in these fami- 
lies,- stationing qualified substance abuse counselors 
in county offices to provide screening, assessment, 
employment readiness, and treatment referral,- and 
ensuring that existing treatment programs provide 
self-sufficiency skills and vocational support for indi- 
viduals with substance-abuse-related impairments. A 
common alcohol/drug-screening tool has been insti- 
tuted. Selected sites will be involved in an enhanced 
employee assistance program to work with employ- 
ers who have agreed to employ substance-abusing 
TANF clients to help them maintain sobriety and be 
successful in the workplace. 

County 



Not applicable. 



A client satisfaction survey conducted by the 
DMH/DD/SAS suggests that 66.7 percent of clients 
felt the program helps them a great deal,- 80.6 per- 
cent of respondents felt that program staff always 
treated them with respect,- 76.3 percent of respon- 
dents felt that the facilities used were always clean 
and comfortable,- 62.4 percent of respondents felt 
that they were involved in making decisions about 
their treatment all of the time, and 26.8 percent 
responded this was the case most of the time,- and 
64.1 percent of respondents were "very satisfied" 
with the program, and 29.3 percent responded they 
were "mostly satisfied." 

Other Quantitative Data 

Section i9i5[h) - Carolina Alternatives: From 1994 to 
1997, the number of children receiving services 
under Carolina Alternatives increased from 7.5 per- 
cent of the eligible Medicaid population being 
served to 8.5 percent. This compares with only 5.3 
percent of Medicaid-eligible children receiving 
mental health or substance abuse treatment in 1992, 
before the waiver was implemented, and a penetra- 
tion rate of 6.4 percent in 1997 for nonwaiver sites. 
The number of children served doubled from 1992 
to 1997, from 5,149 children served to 1 1,265. 

The average number of inpatient days per 
enrollee served decreased from 50.1 days in 1992 to 
19 days in 1997. The average number of inpatient 
days per child decreased from 49.6 days per child in 
1992 to 18.8 days per child in 1997. in 1992, almost 
74 percent of the Medicaid dollars in waiver sites 
were spent on inpatient services. In 1997, only 12.3 
percent of the dollars were spent on inpatient ser- 
vices. Actual dollars spent on inpatient services 
decreased by half from $1 1.8 million to $5 million 
in 1997. 

A report released by the Office of State Budget 
and Management suggests Carolina Alternatives 
was effective in reducing hospitalization of new 
clients. 

From January 1996 through January 1997 the 
Medicaid capitation rate for Carolina Alternatives 
remained unchanged but the per-eligible cost in the 
non-Carolina Alternatives area programs continued 
to rise by between 25 percent and 30 percent, 
according to Division of Health calculations. 



194 



{SAMHSA} Managed Care Tracking System 



NORTH DAKOTA 



OVERVIEW 



The majority of behavioral health services are currently in the fee-for-service system in North 
Dakota. Mental health and substance abuse services are not included in North Dakota's statewide 
primary care case management (PCCM) waiver program for physical health sen/ices, however, an 
amendment to the 1915(b) waiver implemented a pilot project in one county that integrates phys- 
ical health, mental health, and substance abuse services under a full-risk Medicaid managed care 
program. 



Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 

Section 1915(b) - North Dakota Access and Care (NoDAC) - integrated: Under a statewide PCCM pro- 
gram, physical health, mental health, and substance abuse in one county only. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 
Not applicable. 




Geographic Location 

Section i9i5[b) - NoDAC: Grand Forks County^. 

Status of Programs 

Section i9i5[b] - NoDAC: Amendment implemented 
November 1 , 1 997. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Inpatient; outpatient (e.g., clinic services). 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Inpatient; outpatient (e.g., clinic services, partial 
hospitalization); Institution for Mental Diseases ser- 
vices for individuals age 65 and over and age 2 1 and 
under; mental health rehabilitation (e.g., targeted 
case management). 



Medicaid Substance Abuse Services in 
Managed Care Plan 

Section i9i5[b] -NoDAC: Inpatient; outpatient (e.g., 
clinic services). 

Medicaid Mental Health Services in 
Managed Care Plan 

Section i9i5(b) -NoDAC: Inpatient; outpatient (e.g., 
clinic services, partial hospitalization); mental 
health rehabilitation (e.g., targeted case manage- 
ment). 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 



Not applicable. 



July 31, 1998 



195 



Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Section i9i5[b) -NoDAC: None. 

Populations Covered Under Managed 
Behavioral Health 

Section i9i5(h] - NoDAC: Voluntary adults and chil- 
dren: Aid to Families with Dependent Children/ 
Temporary Assistance for Needy Families (AFDC/ 
TANF), poverty-level women and children. 

State Managed Care Program 
Administration 

Section i9i5[h) - NoDAQ The Department of F-luman 
Services (Medicaid) contracts with Northern Plains 
F-lealth Plan, a North Dakotan health maintenance 
organization (F4MO). The HMO is at full risk for 
all medical services in the contract, including sub- 
stance abuse and mental health services. AFDC- 
related and poverty-level-eligible recipients have 
the option of enrolling in the F-IMO or remaining in 
the PCCM program. The purpose of the pilot is to 
determine if a "capitated" managed care approach is 
feasible in a rural State like North Dakota and to 
determine if this concept should be expanded to 
other eligible Medicaid groups and other geograph- 
ical areas of the State. 

Financing of Plans 



Section i9i5[b) - NoDAC: This program is funded by 
Medicaid dollars. The managed care organization is 
at full risk and capitated. Capitation rates were 
based on recipients' aid category, gender, and age. 

Coordination Between Primary and 
Behavioral Health Care 

Section i9i5[b] - NoDAC: The pilot managed care 
contract in Grand Forks County requires all services 
including substance abuse and mental health ser- 
vices, to be coordinated through a primary care 
provider. 



Consumer-Family Involvement 

Section i9i5(b] - NoDAC: Consumer and family 
involvement depends upon the providers' practice 
policies. 

Future Plans 

Section i9{5[b] -NoDAC: None. 

-k New Program Under Development: The 
Department of Human Services, Mental Health 
Division, is planning to submit a waiver to the 
Department of Health and Human Services for the 
carve-out of mental health services for children in 
three regions in the State. This limited program 
would integrate the services started by the 
Partnership Grant program. Preliminary work has 
been initiated. 

State Agency Administration 

The Medicaid, mental health, and substance abuse 
authorities are all under the Department of Human 
Services. The Medicaid authority is the Division of 
Medical Services,- the mental health and substance 
abuse authorities are under the Division of Mental 
Health and Substance Abuse Services. 

Welfare Reform 



North Dakota's TANF plan became effective July 1, 
1997. The program denies benefits to drug felons 
but does not test recipients for drug use. 

County 

Not applicable. 

Evaluation Findings 

Not applicable. 

Other Quantitative Data 

Not applicable. 



196 



{SAMHSA} Managed Care Tracking System 



OHIO 



OVERVIEW 



Although Ohio has not implemented a full carve-out for behavioral health, several other managed 
care initiatives are in place that affect public sector mental health and substance abuse services. Ohio 
has a Section 1115 waiver in 16 counties that provides some behavioral health services to Aid to 
Families with Dependent Children/Temporary Assistance for Needy Families (AFDC/TANF) and 
Fiealthy Start populations, along with the full Medicaid benefit package of physical health ser-vices. 
A voluntary pilot program in two counties also provides Medicaid services for people with disabili- 
ties. Additionally, Ohio hires a private contractor to perform utilization review for inpatient psychi- 
atric services under Medicaid. 



Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 

Section 1115- OhioCare - general health - integrated: Provides the full range of Medicaid covered ser- 
vices. A carve-out arrangement specific to behavioral health (Transfer Services Carve-Out) v/as origi- 
nally planned but has been put on hold. 

Medicaid Voluntary 

Accessing Better Care (ABC) - general health - integrated: A voluntary pilot program in two counties for 

people with disabilities and chronic illness that provides the full range of Medicaid-covered services. 

Other Managed Care Programs 

URIP (Utilization Review for Inpatient Psychiatric services) - Medicaid program - mental health stand-alone: 

Utilization review program. 




Geographic Location 

Section ms - OhioCare: Mandatory enrollment in 
seven counties (Butler, Cuyahoga, Franklin, Hamil- 
ton, Lucas, Montgomery, and Summit) and volun- 
tary enrollment in nine (Clark, Greene, Lorain, 
Mahoning, Miami, Pickaway, Stark, Tmmbull, and 
Wood). A request for proposals (RFP) has been 
released to begin mandatory enrollment in these 
nine counties, effective October 1, 1998. 

ABC: Franklin and Hamilton counties. 

URIP: Statewide. 

Status of Programs 

Section ms - OhioCare: Submitted March 2, 1994; 
approved January 17, 1995,- implemented July 1, 
1996. 

ABC: Implemented June 1, 1995. 



URIP: Coordinated by mental health and con- 
tracted to specialty vendor in October 1996. 

Medicaid Substance Abuse Services 
Remaining Fee-For^Service 



Inpatient; ambulatory detoxification, outpatient 
(e.g., counseling, case management, intensive out- 
patient); crisis; opiate treatment programs (e.g., 
methadone maintenance). 

Medicaid Mental Health Services 
Remaining Fee-For^Service 



Inpatient; outpatient (e.g., clinic services, individ- 
ual and group counseling, psychotherapy); crisis; 
mental health support (e.g., community support 
program); Institution for Mental Diseases services 
for individuals under age 22 and over age 65. 



July 31, 1998 



197 



Medicaid Substance Abuse Services in 
Managed Care Plan 



Section Hi5 - OhioCarc: Inpatient,- acute detoxifica- 
tion,- outpatient (e.g., counseling),- opiate treatment 
programs (e.g., methadone maintenance). 

ABC Medicaid benefit package for acute care 
services, including inpatient services,- opiate mainte- 
nance therapy. 

URIP: Not applicable. 

Medicaid Mental Health Services in 
Managed Care Plan 

Section iiiS - OhioCare-. Inpatient,- outpatient (e.g., 
clinic services, counseling, psychotherapy). 

ABC: Inpatient services,- outpatient (e.g., clinic 
services, individual and group counseling, psy- 
chotherapy), crisis,- mental health support (e.g., 
community support program). 

URIP: Inpatient (utilization revievi^). 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 



Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section ms - OhioCare: Prevention services are 
encouraged as a primary goal of managed care. 

ABC. Prevention services are encouraged as a 
primary goal of managed care. 

URIP: Not applicable. 

The Ohio Department of Alcohol and Drug 
Addiction Services (ODADAS) created the 
Wellness/Health Promotion Work Group to rec- 
ognize prevention services as a value-added com- 
ponent to the full continuum of care. The goal is 
to integrate substance abuse prevention and early 
intervention services into a managed care arena. 
The work group serves in an advisory capacity to 
ODADAS on substance abuse prevention issues, 
provides oversight in the development of an eval- 
uation framework and marketing strategies for 
prevention providers, and makes recommenda- 



tions regarding prevention as related to managed 
care. ODADAS contracted with Conwal, Incor- 
porated to develop and begin implementation of a 
marketing plan for community-based prevention 
providers establishing linkages with managed 
care. 

Populations Covered Under Managed 
Behavioral Health 

Section ms - OhioCare: Mandatory children and 
adults in seven counties and voluntary children and 
adults in nine counties; AFDCAANF/Healthy Start. 

ABC Children and adults voluntary: Supple- 
mental Security Income. 

URIP: Not applicable. 

State Managed Care Program 
Administration 



Section las - OhioCare: The Ohio Department of 
Human Services (ODHS) contracts with 13 health 
maintenance organizations (hIMOs) (8 for-profit, 5 
not-for-profit), which are at full financial risk for the 
entire range of Medicaid-covered services, includ- 
ing inpatient hospital. HMOs are selected through 
a competitive RFP process. Some HMOs subcon- 
tract out behavioral health services, and some have 
both direct subcontractors and a behavioral health 
management company. The plan is responsible for 
covering medically necessary, Medicaid-covered 
mental health and substance abuse services. 
Enrollees can self-refer to mental health and sub- 
stance abuse services that are available through 
community providers — these services are not cov- 
ered by HMOs. ODHS passes federal Medicaid 
funds to the Ohio Department of Mental Health 
(ODMH) and ODADAS to fully pay on a cost- 
reimbursement basis, for these behavioral health 
services. Payment is then made through the 
Medicaid Community Mental Health Program, 
which is administered by ODMH, or the Medicaid 
Community Substance Abuse Treatment Program, 
which is administered by ODADAS. 

ABC ODHS contracts with a not-for-profit 
HMO, which then contracts with an academic 
medical center. The HMO is not at full risk,- there is 
a risk corridor in place with an annual settlement. 
The provider network is established by the HMO 
in accordance with program requirements. 



198 



{SAMHSA} Managed Care Tracking System 



URIP: ODHS contracted with ODMH for all 
utilization review of psychiatric hospital inpatient 
services provided to Medicaid recipients. ODMH 
competitively bid out the services and hired a pri- 
vate contractor, who subcontracts certain services 
out to a mental health provider. The primary con- 
tractor is responsible for developing medical neces- 
sity criteria for inpatient psychiatric admissions, 
developing on-site postpayment review, offering 
intensive case or facility reviews, and facilitating 
provider appeals and recipient hearings, among 
other things. The subcontractor provides the 
precertification function as well as day-to-day 
functions. 

Financing of Plans 



Section ms - OhioCarc: Medicaid is the sole source of 
funds for this program. ODHS pays each HMO a 
predetermined, monthly capitation payment for 
each Medicaid enrollee. ODHS requires HMOs to 
limit their liability for inpatient hospital services 
through stop-loss coverage that is activated when 
an enrollee incurs aggregate inpatient hospital 
claims in excess of $75,000 per year. The Com- 
munity Medicaid Mental Health and the Alcohol 
and Other Drug Treatment programs are financed 
by the respective state agencies on a fee-for-service 
(FFS) basis. 

Capitation rates are annually or semi-annually 
based on the FFS costs of an actuarially equivalent 
nonenrolled population in a prior (base) year, 
adjusted for trend, drug rebate, geographic region, 
age, sex and aid category, and discounted by 6 per- 
cent. An actuary under contract to ODHS has 
developed the rates in accordance with upper pay- 
ment limit requirements. 

ABC Medicaid is the source of funds for this 
program. The HMO is paid a capitation rate, estab- 
lished for seven cost "categories" or "ranges" based 
on the historical FFS costs of the eligible population 
in a base year, trended forward, and adjusted for 
drug rebate. "Old" eligible — those with 6 months or 
more of Medicaid enrollment in the prior fiscal 
year — are assigned to a rate category based on their 
prior-year expenditures. An eighth capitation rate is 
established for "new" eligible — those with less than 
6 months Medicaid claims history — and is calculat- 
ed based on the average FFS costs of all "new" eligi- 



ble in a prior year. This rate is adjusted for the aver- 
age case mix of the population enrolled in the seven 
cost categories. There are no stop-loss provisions, 
but rather risk corridors. Administrative costs are 
capped at 10 percent of medical costs. There is a 
three-tiered risk-sharing arrangement for medical 
costs. HMOs are at risk for 90 percent of the first 5 
percent; 50 percent of the next 10 percent, and 10 
percent of anything over 15 percent of profit or 
loss. 

URIP: Medicaid transfers funds to the DMH, 
which pays the contractor a set fee. 

Coordination Between Prinnary and 
Behavioral Health Care 



Section ms - OhioCare. Behavioral health services 
are provided by or referred by the client's primary 
care physician, who coordinates behavioral and 
physical health care services, or clients can self- 
refer to the community mental health or substance 
abuse treatment systems. Efforts to coordinate pri- 
mary health and behavioral health services are 
occurring at both State and local levels. On the 
local level, HMOs, Alcohol, Drug Addiction, and 
Mental Health/Alcohol and Drug Addiction 
Services (ADAMH/ADAS) boards, and behavioral 
health care providers have developed care coordi- 
nation agreements. Development of these care 
coordination plans is required in the ODADAS and 
ODMH community. Medicaid agreements with 
their respective boards, and in ODHS provider 
agreements with the HMOs. On the state level, 
coordination of activities among ODADAS, 
ODMH, and ODHS occurs regularly and is for- 
mally supported in interagency agreements. 

ABC Services are coordinated the same as they 
are under the Section 1115 waiver. 

URIP: Not applicable. 

Consumer-Family involvement 

Section iiis - OhioCare: ODMH, ODADAS, and 
ODHS have communicated with many constituent 
groups in the State for several years regarding 
Medicaid behavioral health care. 

ABC: An advisory committee was established 
for ABC that included families and consumers, who 
assisted in planning and implementation activities. 

URIP: Not applicable. 



July 31, 1998 



199 



Future Plans 



Section ms - OhioCare-. All voluntary counties will 
become mandatory on October 1, 1998. 

ABC Future plans are currently under evalua- 
tion. 

URIP: Not applicable. 

* New Program Under Development: Ohio hopes to 
build upon the existing community systems of care 
by introducing specialty managed care to the list of 
services currently administered by ODHS. The 
intention is that eventually these services will be 
fully integrated with other publicly funded mental 
health and addiction services through contracts 
with ODMH and ODADAS, so as to create a coor- 
dinated and seamless system of mental health and 
addiction services. 

State Agency Administration 



The Medicaid authority is the Office of Medicaid, 
within ODHS, The mental health authority is 
ODMH. The substance abuse authority is 
ODADAS. 

Welfare Reform 



State plan under P.L 104-193, filed with the U.S. 
Department of Health and Human Services on 
September 19, 1996, became effective October 1, 

1996. Under the State's plan for TANF, no changes 
in Medicaid eligibility were instituted. The plan 
denies benefits to drug felons and requires prenatal 
drug screening, assessment, and treatment for preg- 
nant Medicaid recipients in mandatory managed 
care counties. This mandatory drug screening 
aspect of welfare reform requires active collabora- 
tion between ODHS, ODADAS, HMOs, and 
ADAMH/ADAS boards and providers. 

Prior to passage of the Federal Personal 
Responsibility and Work Opportunity Reconcili- 
ation Act, Ohio began reforming its welfare system 
through passage of House Bill 167, which went into 
effect in August 1995. The creation of Ohio Works 
First (OWF), which went into effect October 1, 

1997, brought further reform. OWF is designed to 
help people become self-sufficient citizens and take 
personal responsibility for their lives, with a strong 
emphasis on obtaining and retaining employment. 
A number of core services are guaranteed to OWF 
participants statewide, including employment ser- 



vices, child care, and Medicaid. The OWF legisla- 
tion indicates that substance abuse addiction treat- 
ment services provided by a program certified by 
ODADAS are to be included in the definition of 
"Allowable Alternative" Work Activities that county 
departments of human services are to establish and 
administer for OWF minor heads of households and 
adult participants. The OWF legislation also 
describes the substance abuse assessment process 
for determining other assistance or services to be 
provided to OWF participants, as well as for ascer- 
taining whether any other member of the assistance 
group has a substance abuse problem. The law spec- 
ifies that the county department of human services 
may refer participants for any assistance or services 
that the agency considers appropriate, such as 
Alcoholics Anonymous, Narcotics Anonymous, or 
Cocaine Anonymous. Ohio Medicaid reimburses 
for medically necessary substance abuse assessment 
and treatment services. 

Benefits are limited to 3 years of cash assistance, 
followed by 2 years of ineligibility,- participants may 
then apply for up to 2 years of benefits if they show 
good cause. County commissioners are to enter into 
Partnership Agreements with ODHS, in which the 
state agrees to provide funding for programs and 
administration, and counties are measured based on 
performance. Communities have the option to 
design and deliver public assistance services. 
Medicaid health care services have not devolved at 
the Federal level. Mandatory managed care counties 
have local coordination agreements between the 
HMOs and ADAMH/ADAS boards that have been 
filed with the State. 

The 59 ADAMH/ADAS boards continue to 
explore the development of managed care tools,- the 
State is monitoring this process. 

As of September 1997, Hamilton County 
implemented a 5-year contract with a private, for- 
profit managed behavioral health care organization 
(MBHCO) to manage the delivery of behavioral 
health services to child welfare clients. Approx- 
imately $3.2 million per year will be spent for the 
information system, training, and administrative 
costs for the management of the program. 
Substance abuse services will use the MBHCO ini- 
tially to handle only its administrative, billing, and 
information functions. The goal is to provide a 
seamless system of care. ODHS, ODMH, and 
ODADAS Medicaid services remain as they have 



200 



{SAMHSA} Managed Care Tracking System 



been described elsewhere because Medicaid is not a 
part of this arrangement. 

The FrankUn County ADAMH Board is 
proposing to implement a case rate approach to 
begin operation within the next 6 months. There 
will be six case rate tiers based on historical use. The 
project is targeted to begin operation in January 
1999 but will affect only non-Medicaid-funded ser- 
vices. This issue is under current review. 

County 

Not applicable. 

Evaluation Findings 



Section Hi5 - OhioCarc: Since July 1, 1996, HMOs 
have been required to submit encounter data to 
ODHS on a monthly basis. A committee that 
included HMO representatives selected a number 
of performance measures that pertain to perinatal 
care, care of children, and mental health care. The 
measures are based on Health Employer Data and 
Information Set (HEDIS) measures, with some vari- 
ations. These measures, in conjunction with mem- 
ber satisfaction surveys and other tools, are being 
used to evaluate the performance of HMOs in 
meeting the needs of Medicaid recipients. ODHS 
has calculated the performance measurement results 
for State fiscal year 1997 and will soon be issuing a 
report to the HMOs which outlines the results. 

ODHS is also pursuing a comprehensive quali- 
ty agenda. In addition to monitoring the HEDIS 
measures, ODHS is looking at consumer com- 
plaints and satisfaction, having recently conducted 
a consumer satisfaction survey. Looking at the par- 
ticular behavioral health care needs of consumers 
and how these needs are being met is another im- 



portant area that needs to be examined. ODHS 
desires to pursue a similar kind of quality agenda 
with statewide measures if the Medicaid behavioral 
health care system becomes integrated. 

ODHS also contracts with an external quality 
review organization (EQRO). The EQRO conducts 
an annual independent assessment of the quality of 
services delivered to Medicaid recipients enrolled in 
Medicaid-serving HMOs. The EQRO evaluates 
whether the administrative processes of the HMOs 
comply with state administrative rules and conducts 
quality care studies. 

The following areas have been targeted for 
study: childhood immunizations,- prenatal care, 
early and periodic screening, diagnostic and treat- 
ment services (EPSDT),- childhood asthma,- and 
dental care. The EQRO is also looking at adult 
depression. ODHS has urged the community 
behavioral health system to explore the merits of 
having a statewide EQRO assess the quality of com- 
munity mental health and substance abuse treat- 
ment services. 

Other Quantitative Data 

Encounter data, including those related to the ABC 
program, have been collected from the HMOs 
since July 1, 1996. Additionally, the HMOs provide 
aggregate utilization data to ODHS on a quarterly 
basis. A research grant to perform an evaluation of 
the ABC program was awarded to Case Western 
Reserve University. The evaluation will consider 
utilization of services, length of enrollment in the 
program, variations in case mix by county, con- 
sumer satisfaction, and the predictive reliability of 
risk-adjusted capitation rates. TTie evaluation is not 
yet complete. 



July 31, 1998 



201 



OKLAHOMA 



OVERVIEW 



Oklahoma's existing Medicaid waiver program, entitled SoonerCare, encompasses two distinct man- 
aged care initiatives: SoonerCare Plus and SoonerCare Choice. Eligibility for these programs is con- 
tingent upon both Medicaid eligibility and geographic area of residence. SoonerCare Plus is a fully 
capitated health care model implemented in three of the most populous areas of the State. 
SoonerCare Plus includes behavioral health services with an enhanced benefit package for individu- 
als identified by the Oklahoma Health Care Authority (OHCA) (the State Medicaid agency) to have 
special mental health needs (serious mental illness/severe emotional disturbance (SMl/SED)). 
Behavioral health series under SoonerCare Plus are provided by contracted health maintenance orga- 
nizations (HMOs). The second initiative, SoonerCare Choice, is a primary care case management 
(PCCM) program implemented in the remaining areas of the State. Behavioral health services under 
this program remain in the fee-for-service (FFS) system. 



Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 






1 


Section 1115- SoonerCare: 






i 


SoonerCare Plus - integrated: 


Fully integrated HMO model that includes an enhanced benefit | 


package for individuals determ 


ined by 


the OHCA to have special mental health needs 


(SMl/SED). 


SoonerCare Choice - general 


health - 


PCCM model: Behavioral health services remain 


in the FFS 


system. 








Medicaid Voluntary 








Not applicable. 








Other Managed Care Programs 




i 


Not applicable. 










Geographic Location 

Section ms - SoonerCare - SoonerCare Plus: Oklahoma 
City, Tulsa, Lawton, and surrounding counties. 

Status of Programs 



Medicaid Substance Abuse Services 
Remaining Fee-For^Service 



Section ms - SoonerCare - SoonerCare Plus-. Submitted 
December 1994, approved by the Health Care 
Financing Administration October 1995, protocol 
approved December 1995, effective January 1, 
1996; implemented Febmary 1996. 

Amendment to include SMl/SED on voluntary 
basis submitted and approved January 1997,- imple- 
mented July 1, 1997. Amendment to include SMI/ 
SED on mandatory basis submitted November 1997,- 
approved April 1998, to be implemented July 1, 1998. 



Substance abuse services, covered through the 

Medicaid FFS program, vary for children and adults. 
Services are pre-authorized for one of four levels of 
care ranging from limited outpatient to intensive 
outpatient care. 

Substance abuse services for adults include 
inpatient (12 maximum inpatient days per year for 
all inpatient stay needs, including physical and 
behavioral health care stays — this includes detoxifi- 
cation), outpatient (e.g., individual, family, group, 
and rehabilitative treatment). 

Substance abuse services for children include 
outpatient (e.g., hospital-based day treatment, indi- 
vidual, family, group, and rehabilitative treatment),- 



July 31, 1998 



203 



therapeutic foster care,- acute detoxification (only 
when medically necessary). 

Medicaid Mental Health Services 
Remaining Fee-For^Service 



Mental health services for adults include outpatient, 
mental health support, and mental health rehabilita- 
tion. Children's mental health services include inpa- 
tient, residential, outpatient, mental health support, 
and mental health rehabilitation. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section iiis - SoonerCare - SoonerCare Plus: For all 
SoonerCare Plus members: outpatient (e.g., individ- 
ual, family, and group treatment, evaluation, and 
testing); detoxification (only when medically neces- 
sary), residential (e.g., for pregnant women and 
their children). 

Medicaid Mental Health Services in 
Managed Care Plan 

Section ms - SoonerCare - SoonerCare Plus: For non- 
SMl/SED members: inpatient,- outpatient,- (e.g., 
individual, family, and group therapy, day treat- 
ment, evaluation, and testing),- crisis. 

For SMI/SED members, the above services in 
addition to intensive outpatient services,- rehabilita- 
tion (e.g., psychosocial services, case management),- 
residential (e.g., home-based services),- crisis (e.g., 
mobile assessment),- mental health support (e.g., in- 
home, peer counseling),- therapeutic foster care 
(children only). 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 



Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section ms - SoonerCare - SoonerCare Plus. Early and 
periodic screening, diagnosis, and treatment 
(EPSDT). 



Populations Covered Under Managed 
Behavioral Health 

Section iii5 - SoonerCare - SoonerCare Plus: Mandatory 
adults and children: Aid to Families with Dependent 
Children/Temporary Assistance for Needy Families 
(up to 45 percent Federal poverty level). 

State Managed Care Program 
Administration 

Section ms - SoonerCare - SoonerCare Plus: Under the 
OF4CA, SoonerCare Plus contracts with private, 
nonprofit F4MOs that provide services through 
their networks. Some of the SoonerCare HMOs 
directly provide the behavioral health care manage- 
ment. For Year IV of SoonerCare Plus (July 1, 
1998-June 30, 1999), three of the four HMOs 
subcontract, at least partially, behavioral health care 
management to separate entities, in order to ensure 
that essential community providers participate in 
the provider network, health plans are required by 
the OHCA to offer contracts equal in scope and 
reimbursement to the essential community 
providers, including the 19 community mental 
health centers (CMHCs) in Oklahoma. The health 
plans contract with other behavioral health care 
providers in addition to the CMHCs that 
participate. 

Three of the four SoonerCare Plus HMOs con- 
tracted for Year IV subcontract behavioral health 
care management. Two of the HMOs subcontract 
all behavioral health management, and one HMO 
subcontracts behavioral health management in one 
service area and retains internal management for the 
other service area. 

The behavioral health organizations' subcon- 
tracts fulfill the OHCAs requirements for behav- 
ioral health service provision by SoonerCare Plus 
providers. Services contracted include, but are not 
limited to utilization review, encounter data devel- 
opment, assessment and recommendation for 
SMI/SED determination, referral of behavioral 
health services for plan members, monitoring of 
provider network, coordination of services for 
SMI/SED members (including mandatory case man- 
agement and assessments), and maintaining quality 
assurance. 

The annual contracting process for SoonerCare 
Plus includes issuance of a request for proposals 
(RFP) by the OHCA, review of written bids and 



204 



{SAMHSA} Managed Care Tracking System 



responses to the RFP, award of SoonerCare Plus 
contracts, completion of readiness reviews for each 
awarded health plan, and completion of annual 
operational compliance audits of each SoonerCare 
Plus health plan, in addition, the OHCA Behavioral 
Health Services Unit assesses requests for SMl/SED 
determinations from the health plans and responds 
to formal and informal grievances from behavioral 
health care providers and members. 

Financing of Plans 

Section iH5 - SoonerCare - SoonerCare Plus: Under 
SoonerCare, HMOs are fully capitated and at risk. 
Medicaid dollars finance the program. HMOs are 
paid a capitated rate based on FFS historical costs 
using actuarial calculations. 

The OHCA has established two capitation 
rates for SMl/SED population, one for adults (age 
21 and over) and a second for children (under age 
21). The same adult and child rates will be paid to 
all health plans across all service areas. It should be 
noted that these rates are inclusive of all care, not 
just the behavioral health care provided to the SMI 
or SED. The actual capitation rate amounts are as 
follows: Adults age 21 and over: $229.31 per mem- 
ber per month; children under age 2 1 : $75 1.12 per 
member per month. 

In developing capitation rates, the OHCA 
relied on historical FFS claims for SMl/SED individ- 
uals disenrolled from health plans since the start of 
the SoonerCare Plus program. The data was adjust- 
ed to account for changes made to the FFS program 
early in State fiscal year 1 997, including adoption of 
new payment rates and a prior authorization system 
for behavioral health services. 

The cost of services for SMl/SED members, in 
the aggregate, is compared to the total capitation 
paid for those members. The health plan and the 
OHCA share the risk based upon the percentage of 
gains or losses in specified risk-sharing corridors. 

The OHCA made capitation payments to the 
health plans on a monthly basis via electronic funds 
transfer. The OHCA issues a prepaid, per member, 
per month amount as payment in full for any and all 
covered services provided to the member. 
Capitation payments are member-specific and 
appropriate to the member's rate category. 



Coordination Between Primary and 
Behavioral Health Care 



Section Hi5 - SoonerCare - SoonerCare Plus. In Sooner- 
Care Plus the plans are responsible for all care and 
are evaluated on coordination of care concerns. 

Consumer-Family Involvement 



Section iiis - SoonerCare - SoonerCare Plus: Consumers 
and consumer advocacy associations have assisted 
in the development of SoonerCare through focus 
groups, membership on various task forces, and 
ongoing dialogue with OHCA staff. The OHCA 
released an invitation to bid for a consumer-based 
advocacy program to provide education and advo- 
cacy services for Medicaid recipients designated 
SMl/SED. A contract for this program has not been 
awarded. Currently, consumer education and assis- 
tance is provided by the OHCA Behavioral Health 
Services Unit. In addition to other outreach efforts, 
the OHCA facilitates monthly meetings with con- 
sumer advocacy organizations in an effort to main- 
tain positive relations with behavioral health con- 
sumers and advocates. 

Future Plans 

Section ms - SoonerCare - SoonerCare Plus: Under this 
waiver. State legislation mandates aged, blind, and 
disabled enrollment in managed care by July 1, 
1999. The OHCA is actively developing the frame- 
work and specifics of the future managed care ser- 
vices and delivery system for those Medicaid recip- 
ients. Internal and external planning meetings are 
being held regularly. The population will most like- 
ly be noninstitutionalized, non-dually-eligible 
(Medicare/Medicaid), non-State-custody (children) 
Medicaid recipients statewide. 

In addition, the existing urban geographic 
boundaries for inclusion in SoonerCare Plus may 
expand, but there is no definite established timeline. 

For the rural population being served in the 
PCCM model, a co-existing and complementary 
behavioral health managed care program may be 
developed and initiated over the next year. 

'k New Program Under Deiyelopment: The Depart- 
ment of Mental Health and Substance Abuse 
Services (DMHSAS) has designed a pilot managed 
care project that will provide behavioral health ser- 
vices to non-Medicaid recipients in DMHSAS-sup- 



July 31, 1998 



20S 



ported or -contracted facilities. Implementation of 
this program is pending resolution of funding and 
design barriers. No proposed implementation date 
has been identified. 

Ultimately, the intent of this program is to gen- 
eralize the managed care system to the entire state 
pending the outcome of the project. Functions per- 
formed by the technical services vendor will be 
transitioned to DMHSAS or its provider networks. 
In the second and subsequent years, one or more 
provider networks may be selected to organize and 
manage services for the defined priority popula- 
tions. Specific report card/outcome indicators have 
been developed as evaluation tools for this pilot 
project. 

* New Program Under Development: The Depart- 
ment of Human Services (DHS), Division of Child- 
ren and Family Services (DCFS) has requested 
money through the state to provide technical assis- 
tance in the development of a child welfare man- 
aged care system. Such a system would ensure a 
continuum of service delivery for DHS-custody 
children and their families. The goal for a managed 
child welfare system would be to maximize funding 
streams to enhance benefits, develop provider net- 
works, and improve quality of services. DCFS cur- 
rently outsources with a variety of private vendors 
for an array of clustered services. 



State Agency Administration 

OHCA is the State agency responsible for 
Oklahoma's Medicaid program. DMHSAS houses 
the Mental Health and Substance Abuse agencies. 

Welfare Reform 

Oklahoma's Temporary Assistance for Needy 
Families (TANF) program became effective October 
1, 1996. It does not require drug testing of all 
TANF-eligibles; it does deny TANF benefits to 
those individuals convicted of drug felonies. 

Oklahoma has received waivers from Health 
and Human Services to operate two welfare reform 
demonstrations under Title IV- A, Section 1115 of 
the Social Security Act: Oklahoma Learnfare 
Project and Mutual Agreement — A Plan for 
Success. The State indicates it will continue its two- 
county Learnfare waiver until its completion. 

County 

Not applicable. 

Evaluation Findings 



Section ms - SoonerCare - SoonerCare Plus: OHCA 
monitors the health plans through the use of Health 
Employer Data and Information Set (HEDIS) 3.0. 



Other Quantitative Data 

Not applicable. 



206 



{SAMHSA} Managed Care Tracking System 



OREGON 



OVERVIEW 



Oregon's Medicaid managed care program — the Oregon Health Plan (OHP) — includes coverage 
for mental health and substance abuse services statewide for both Medicaid and non-Medicaid pop- 
ulations. Substance abuse services are fully integrated into the OHP, since prepaid health plans have 
responsibility for these services statewide. After a pilot carve-out, mental health benefits were grad- 
ually integrated statewide into the OHP. Currently, mental health is integrated in eight counties, 
and there is a carve-out provider in all counties. 

Additionally, the State is implementing a demonstration to integrate intensive mental health with 
physical health services for children under OHP. 



Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 

Section 1115- OHP - general health - integrated: Includes mental health and substance abuse services. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

Children's Intensive Mental Health Treatnient Services - integrated: The Office of Mental Health Services, 
Mental Health Developmental Disabilities Services Division (MHDDSD) is developing an initiative to 
pilot the integration of children's intensive mental health treatment services into OHP mental health 
organizations (MHOs). 




Geographic Location 



Section ms - OHP: Statewide. 

Children's Intensive Mental Health Treatment Services: 
Unknown. 

Status of Programs 

Section ms - OHP: Approved March 19, 1993, 
implemented February 1, 1994,- outpatient sub- 
stance abuse services placed under managed care 
May 1, 1995; mental health services phased in 
January 1, 1995 in 20 of the 36 counties, remaining 
counties phased in October 1, 1997. As of January 
1, 1998, all 36 counties in Oregon have OHP men- 
tal health services under managed care, even those 
that have hied legal challenges. 

Children's Intensive Mental Health Treatment Services: 
The pre-pilot began October 1, 1997, and will mn 
until September 30, 1998. 



Medicaid Substance Abuse Services 
Remaining Fee-For-Servlce 



Outpatient; opiate treatment 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Adults and children: Inpatient, outpatient, pharma- 
cy, mental health support, mental health rehabilita- 
tion. 

Children only: Residential. 

Medicaid Substance Abuse Services in 
Managed Care Plan 



Section Hi5 - OHP - Chemical dependency benefits 
include outpatient; opiate treatment. 



July 31, 1998 



207 



Medicaid Mental Health Services in 
Managed Care Plan 



Section iiis - OHP: Mental health services include 
only inpatient; Institution for Mental Diseases ser- 
vices for individuals under age 2 1 and over age 65; 
outpatient, mental health support, mental health 
rehabilitation,- crisis,- pharmacy. 

The MHO provides all medically necessary and 
appropriate mental health services covered by the 
capitation payment for the 38 funded mental health 
conditions appearing on the list of prioritized health 
services. MHOs are also required to cover the cost 
of care in acute inpatient psychiatric programs for 
individuals, except individuals needing long-term 
care or who require State hospitalization. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Children's Intensive Mental Health Treatment Services: Not 
applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 



Children's Intensive Mental Health Treatment Services: 
Outpatient (e.g., day treatment), residential (e.g., 
psychiatric). 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Section 1 i 15 - OHP: The State requires each prepaid 
health plan to meet a total of 21 conditions, 
including one for prevention and education ser- 
vices. Capitated services include mental health ser- 
vices formerly provided under early and periodic 
screening, diagnosis, and treatment (EPSDT) for 
children. 

Children's Intensive Mental Health Treatment Services: 
None. 

Populations Covered Under Managed 
Behavioral Health 



Section ms - OHP: Mandatory adults and children: 
Aid to Families with Dependent Children/ 
Temporary Assistance for Needy Families, pregnant 
women and children under age 12 (170 percent of 
Federal poverty level (FPL)), Supplemental Security 
Income (SSI), dual eligible (Medicare/Medicaid). 



Children's Intensive Mental Health Treatment Services: 
Children in state custody, foster children, children 
with severe emotional disturbance. 

State Managed Care Program 
Administration 



Section ms - OHP: The Oregon Department of 
F4uman Resources (DF-IR) is the single State 
agency responsible for Medicaid and the Oregon 
FHealth Plan. The Office of Medical Assistance 
Programs (OMAP) has primary responsibility for 
the oversight and administration of the Section 
1115 waiver. The offices and divisions of OMAP 
work collaboratively with the Office of Alcohol 
and Drug Abuse Programs (OADAP) and the 
MFHDDSD in the planning, development, imple- 
mentation, monitoring, and evaluation activities 
related to integrating mental health and chemical 
dependency services. 

Chemical dependency benefits: For the provi- 
sion of health and substance abuse services, the 
State (Medicaid) contracts with fully capitated 
health plans (FCF^Ps) and physician care organiza- 
tions (PCOs). FCFHPs include health maintenance 
organization (FHMOs) and other provider network 
organizations. PCOs are multipractitioner prepaid 
health plans that deliver or arrange for health care 
services, PCO clients in need of mental health ser- 
vices are referred to MF40s. 

The OADAP requires that at least 50 percent of 
FCF4P members who need chemical dependency 
services receive those services from State-approved 
facilities (in most locations, however, it is actually 
closer to 100 percent). These providers are inde- 
pendent providers that are approved by the State as 
meeting quality assurance standards and rules issued 
by the State. 

Mental health benefits: The State currently 
operates a hybrid model for mental health services 
under OFHP by contracting with both county carve- 
out plans (MHOs) and fully capitated health plans 
(HMOs). In September 1997, when the state issued 
the request for proposals (RFP) to roll out mental 
health statewide, it included a preference for coun- 
ty mental health agencies by accepting private 
carve-out proposals only in areas where a county 
chose not to apply. Balancing this against the need 
to ensure movement toward contracting with "full- 
service managed care organizations" per state 



208 



{SAMHSA} Managed Care Tracking System 



stature, the RFP contained a "viability determina- 
tion" for carve-out MHOs. 

During the evaluation of the RFP responses, the 
State announced a quantifiable standard to address 
the viability issue: that each awarded MHO carve- 
out have a minimum of 50 percent of Medicaid-eli- 
gible covered lives available. The State used this 
standard in determining whether one or more con- 
tracts could be awarded within a county, in the 
majority of counties, the State has designated one 
contractor as the MHO,- however, in 8 of the 36 
counties statewide, the State contracts with both 
HMOs and MHOs, establishing county mental 
health agencies and HMOs as competing MHOs. 

MHOs cover 88 percent of the Medicaid lives 
and contract independently or on a regional basis 
with the State Mental Health Division. 

The Mental Health Division contracts with 1 3 
organizations statewide. Three are local mental 
health authorities that applied independently to 
provide mental health services within their county 
boundaries. Two are private MHOs, one of which is 
a consortium of 1 7 rural Oregon counties where the 
local mental health authorities continue to provide 
the mental health services for their counties. Three 
more are regional county mental health consor- 
tiums, and five are fully capitated health plans 
(HMOs) that provide the mental health benefit for 
their physical health plan enrollees in selected 
counties. These HMOs currently subcontract with 
mental health/behavioral health organizations to 
provide the mental health services to their enrollees. 

In reaction to the statewide roll-out of OHP, 
three counties in Oregon have filed circuit court 
petitions to reverse the State's decision on contract 
awards for its capitated Medicaid mental health pro- 
gram. Unlike legal challenges in other states, this 
one comes from traditional players in the public 
mental health system. All three of the counties were 
selected under the statewide implementation plan 
but are disputing the use of fully capitated health 
plans to share responsibility for mental health ser- 
vices in the counties. The counties charge that the 
state violated regulations governing the procure- 
ment process by failing to follow the stated criteria 
of the RFPs and making an award based on propos- 
als from unqualified bidders. Thus far, all three cases 
have been consolidated under one judge and are 
pending. 



Children's Intensive Mental Health Treatment Services: 
OMHS will contract with day and residential treat- 
ment providers and therapeutic group homes. 
OMHS will provide technical assistance and modi- 
fy contracts with pilot providers to ensure that pilot 
projects have the necessary fiscal and contractual 
flexibility to redesign and restructure delivery sys- 
tems at current funding. 

The role of providers will likely be as subcon- 
tractors with the MHOs. The Division will contract 
with the MHOs directly and they in turn will sub- 
contract with the "Intensive" providers. Most of the 
providers are private nonprofits with several public 
entities. 

Financing of Plans 

Section iiis - OHP: OHP is financed through 
Medicaid and State general funds. 

Chemical dependency benefits: FCHPs 
(HMOs) are paid a capitated rate for most health 
services in the benefit plan, including substance 
abuse (residential detoxification is fee-for-service) 
and assume full financial risk for them. The capita- 
tion rate is per member per month. One FCHP pro- 
vides services directly with some subcontracting, 
and the other subcontracts for all services. 

Mental health benefits: MHOs are fully capi- 
tated and at risk and receive a monthly per member 
per month capitation payment from the MHDDSD 
for each enrolled OHP-eligible person. The MHO 
is required to protect itself against loss either by 
self-insuring or by obtaining stop-loss protection 
from a private insurer. The capitation rates are based 
on historic fee-for-service claims adjusted for eligi- 
ble groups for which the State did not have fee-for- 
service claims history. A private actuarial firm calcu- 
lated the rates in a manner consistent with the med- 
ical-surgical rates. 

HMOs receive a separate capitation payment 
for mental health. There are two separate (physical 
health and mental health) contracts with different 
rates. If the HMO subcontracts for mental health or 
substance abuse services, the HMO/MHO deter- 
mines how the subcontractor is paid. Currently, all 
of the HMOs that also contract as MHOs subcon- 
tract with specialty MHOs to manage their mental 
health benefit on a capitated basis. Some of the 



July 31, 1998 



209 



HMOs also include chemical dependency and 
Medicare in these subcontracting arrangements. 

Children's Intensive Mental Health Treatment Services: 
Not yet finalized. 

Coordination Between Prinnary and 
Behavioral Health Care 



Section ms - OHP. Coordination of services is man- 
dated in OHP contracts, but methods for accom- 
plishing the task vary greatly throughout the State. 
MHDDSD and the Office of OHP Policy and 
Research are currendy collecting data on this issue. 
Children's Intensive Mental Health Treatment Services: 
Coordination of services is mandated in the con- 
tract but methods for accomplishing the task vary 
greatly throughout the State. MHDDSD and the 
Office of OHP Policy and Research are currently 
collecting data on this issue. This process is still 
being finalized. 

Consumei^Family Involvement 

Section iH5 - OHP: During the design phase, con- 
sumer and family representatives played a key advi- 
sory role on the statewide planning and manage- 
ment council in developing OHP. They have played 
a larger role in implementation. From 1997 to 1999, 
contractors are required to include consumers on 
advisory bodies and quality improvement councils. 
MHOs have consumer and family representation on 
their quality assurance committees. Several have 
hired consumers as ombudsman— consumer affairs 
officers. Likewise, many family members have been 
hired as family advocates. Globally, the perspective 
of consumers and families is being more thoroughly 
integrated into the delivery system. 

Children's Intensive Mental Health Treatment Services: 
Pilots will work collaboratively with family repre- 
sentatives in the design and implementation of their 
projects. Thus far, family advocates have been 
involved in the planning of the demonstration. 

Future Plans 



Section iiis - OHP: OMAP is planning to use Health 
Employer Data Information Set (HEDIS) indicators 
to monitor the quality of plans and use encounter 
data submitted by plans to help set and validate 
rates. 



Oregon is expanding efforts for substance abuse 
clients to provide up to 14 hours per week outpa- 
tient care under OHP. Those placed in residential 
care will be paid for by a separate mechanism: 
through a State tax on beer and wine. 

* New Program Under Development: The Legislative 
Emergency Board granted a request by Oregon's 
OMAP January 29, 1998, to form two study groups 
to examine the Oregon Medicaid proposal for 
greater oversight of 10 mental health drugs. At the 
end of 6 months the State Medicaid office will 
decide what type of oversight program, if any, it will 
put before the Board. The drugs to be reviewed are 
three antipsychotics — Clozaril, Zyprexa, and 
Risperdal — and seven antidepressants — Prozac, 
Zoloft, Paxil, Wellbutrin, Effexor, Serzone, and 
Luvox. 

* New Program Under Development: The Oversight 
Task Force on Mental Health Integration was creat- 
ed under executive order by the Governor "to mon- 
itor all aspects of the transition of mental health ser- 
vices to managed care." Membership is diverse and 
includes two members of the Oregon State 
Legislature. The Task Force is studying the effects of 
integration. Work is scheduled to be completed by 
December 31, 1998. 

The Task Force, through a metro-area subcom- 
mittee and a southern Oregon subcommittee, has 
examined several tentative contract offers that were 
made by the division and were subject to Task Force 
review and recommendations. The Task Force rec- 
ommended that no new contracts be implemented 
at this time. The MHDDSD has implemented this 
recommendation and will work with current con- 
tractors on a variety of implementation issues. 
MHDDSD does not intend to pursue another pro- 
curement process until July 1, 2001, at the earliest. 
The Task Force will now focus on other policy and 
implementation issues, such as improved coordina- 
tion between mental health and primary care and 
between mental health and chemical dependency 
providers. 

Children's Intensive Mental Health Treatment Services: 
Pilot is scheduled to run from October 1, 1998, 
through December 31, 1999. Full integration will 
occur on January 1, 2000. 

* New Program Under Development: Oregon plans 
to use federal funds for uninsured children to 
expand the Medicaid and subsidy programs. The 



210 



{SAMHSA} Managed Care Tracking System 



benefit package will be the same as OHP's and will 
include the mental health benefit. This effort is esti- 
mated to cost $23 million over the next 2 years to 
target working families who cannot afford premium 
cost-sharing under their employer's plan. The pro- 
gram has been approved and enrollment is set to 
begin July 1, 1998. The benefit package will be the 
same as under the OHP, and will include the mental 
health benefit. The population included initially 
will be children through age 19 (approximately 
16,800 children) up to 170 percent FPL, with 
expansion to 200 percent FPL at a later date. 

State Agency Administration 

Oregon's Medicaid, Mental Health, and Substance 
Abuse agencies are housed under one department, 
the DHR. OMAP, MHDDSD, and OADAP are the 
respective agencies. 

Welfare Reform 

In 1992, Oregon received a welfare reform waiver 
through Tide IV- A, Section 1115 of the Social 
Security Act, which among other things, requires 
Job Opportunities and Basic Skills (JOBS) partici- 
pants to engage in various treatment programs, 
including mental health and substance abuse diag- 
nostic, counseling, and treatment programs. The 
substance abuse and mental health components of 
Oregon's JOBS program are provided within the 
context of a JOBS program that aims to move recip- 
ients into the labor market as quickly as possible and 
within the context of a welfare system that empha- 
sizes job placements rather than the provision of 
cash assistance as its primary mission. 

Oregon has relied on both administrative and 
policy changes to shift the emphasis of welfare 
reform from the provision of cash assistance to 
employment. Three administrative changes are 
especially important to the implementation of the 
waiver allowing substance abuse or mental health 
treatment to be mandated for JOBS clients: 1 ) using 
case managers, 2) emphasizing up-front job search 
and self-sufficiency planning, and 3) relying on a 
labor force attachment model. 

Funding for mental health and substance abuse 
treatment services for welfare recipients is included 
in the overall budget for the JOBS program which is 
financed with State lottery and general fund dollars. 



These funds are allocated by the State legislature 
and matched to Federal funds. The districts then 
decide how much of their overall allocation will be 
spent to provide substance abuse and mental health 
services, allowing local districts to develop service 
systems that respond to the needs of their recipients 
and take into account variation in local services 
delivery systems. These mental health and sub- 
stance abuse services are "wraparound services" that 
cover needs not met by the health plans under the 
Medicaid managed care program, OHP. Treatment 
is provided through the OHP. Mental health ser- 
vices for JOBS program participants are included in 
OHP mental health capitation rates. MHO con- 
tractors are required to work collaboratively with 
adult and family services district managers to ensure 
that the mental health needs of participants are 
appropriately met, including education, screening, 
and treatment. 

County 

Section ms - OHP: Twenty-three counties operate 
carve-out plans. Examples of these plans are 
described below. 

Fully Capitated Health Plans: 

Family Care, Regence HMO Oregon, ODS, 
and Tuality Health Alliance are all fully capitated 
health plans. The plans provide physical and mental 
health benefits to their enrollees. As HMOs and 
MHOs, Family Care, ODS, and Regence each 
cover four counties,- Tuality Health Alliance is in 
one county. Three of these subcontract with the 
same behavioral health organization to provide the 
mental health benefit, and several also subcontract 
with other MHOs to provide mental health services 
to enrollees. 

Carve-Outs: County Governments/Regional 
Organizations: 

Accountable Behavioral Health Alliance is a 
county government carve-out that covers four 
counties: Benton, Deschutes, Jefferson, and Lincoln. 
Services are provided by the local mental health 
authorities and a variety of private practitioners. 

Jefferson Behavioral Health is a county govern- 
ment carve-out that covers six counties: Coos, 
Curry, Douglas, Jackson, Josephine, and Klamath. 
Services are provided by the local mental health 
authorities. 



July 31, 1998 



211 



Mid- Valley Behavioral Care Network is a coun- 
ty government carve-out that covers five counties: 
Linn, Marion, Polk, Tillamook, and Yamhill. 
Services are provided by the local mental health 
authorities and a variety of private practitioners. 

Clackamas County MHO is a local mental 
health authority/county mental health plan 
(LMHA/CMHP) that uses a closed provider panel 
for direct provision of most outpatient mental 
health services, but may use nonpanel providers 
under special circumstances. Clackamas MHO also 
contracts with local hospitals for acute inpatient 
psychiatric services using declining daily rates. 

LaneCare is an MHO that is part of Lane 
County LMHA/CMHP and uses an established 
provider panel for direct provision of most outpa- 
tient mental health services. LaneCare has a part- 
nership with an FCHP to provide administrative 
support primarily in the areas of claims payment, 
data management, and completion of contractually 
required reports. 

CAAPCare in Multnomah County is an MHO 
that is part of the LMHA/CMHP and uses an estab- 
lished provider panel for direct service provision for 
most outpatient mental health services. CAAPCare 
also contracts with local hospitals for acute inpa- 
tient psychiatric services. 

Private Carve-Outs: 

Providence Health Systems is a private organi- 
zation that was selected as the carve-out for 
Washington County. Providence also subcontracts 
with ODS to provide the mental health services for 
enrollees in Washington County. 

Greater Oregon Behavioral Health Incor- 
porated (GOBHl) is a partnership model of coun- 
ty mental health programs and uses its own mem- 
bers and contract providers to deliver outpatient 
mental health services. It also contracts with 
Eastern Oregon Psychiatric Center (a state facili- 
ty) and two private hospitals for acute inpatient 
psychiatric services. GOBHl serves Baker, Clatsop, 
Crook, Gilliam, Grant, Harney, Hood, River, Lake, 
Malheur, Morrow, Sherman, Umatilla, Union, 
Wallowa, Wasco, and Wheeler Counties. In these 
17 counties, the OHP-eligible person is enrolled 



with and receives mental health services from the 
single behavioral health organization serving 
the county. GOBHl covers members in Columbia 
County which is also served by Regence HMO 
Oregon and Family Care, two FCHP/MHOs that 
contract with GEES to manage the mental health 
and chemical dependency benefit for their 
members. 

Evaluation Findings 



Section liis - OHP: Although not specifically related 
to mental health or substance abuse, recent findings 
from a 1 997 evaluation were as follows: The number 
of services covered under Medicaid was reduced,- 
managed care cost more per eligible person than 
FFS; Medicaid eligibility was expanded, length of 
stay and inpatient bed days decreased,- use of ser- 
vices increased, and there was general satisfaction 
with services. 

A separate study conducted by Michael Finigan 
(independent contractor) concluded that for every 
dollar Oregon spent on substance abuse treatment 
for all recipients, $5.60 was saved on other social 
services. Clients who completed these treatments 
earned 65 percent more income than clients in a 
comparison group. These individuals were also 45 
percent less likely to be arrested and half as likely to 
be investigated for child abuse or neglect. 

Oregon's Office of Mental Health Services 
recently gathered survey data on consumer satisfac- 
tion related to managed care. This data is currently 
under review. The survey is based in part on the 
national Mental Health Statistics Improvement 
Program (MHSIP) Consumer-Oriented Mental 
Health Report Card. Oregon recently completed a 
Stage I and II Federal MHSIP Grant, and the final 
report is currently under draft. The State is now 
working on an MHSIP State Reform Grant. The 
preliminary findings show general satisfaction in 
both the adult and child systems. A complete analy- 
sis and report has yet to be done. 



Other Quantitative Data 

Not applicable. 



212 



{SAMHSA} Managed Care Tracking System 



PEN NSYLVAN I A 



OVERVIEW 



Pennsylvania is progressing with implementation of its mandatory-enrollment Medicaid managed 
care program, HealthChoices, which features a physical health program operated by health mainte- 
nance organizations (HMOs) and a behavioral health component operated by counties. Under the 
HealthChoices behavioral health program, counties have right of first opportunity to manage the 
behavioral health Medicaid program. Counties have the further option of establishing their own 
behavioral health managed care organization (BHMCO) or subcontracting with a private sector 
BHMCO. The southeast part of the State was the hrst to implement this program. All but one of the 
five southeast counties are subcontracting with private, for-profit managed care organizations 
(MCOs). The remaining county, Philadelphia, has formed its own nonprofit organization to manage 
care. 

The State is preparing to implement the program in ten southwest counties beginning January 
1, 1999. it is currently negotiating with three individual counties and a six-county partnership, and 
should begin implementation in 1999. Eight out of ten counties plan to subcontract behavioral 
health services to a private, for-profit MCO. Allegheny County plans to subcontract to a private, 
nonprofit consortium of mental health and substance abuse providers. One county did not submit 
a proposal, and the State will contract directly with a private sector MCO. 

In some areas where HealthChoices has not been implemented, the State operates a voluntary 
HMO program and primary care case management (PCCM) programs. The voluntary HMO pro- 
gram includes basic behavioral health services and clients enrolled in the PCCM programs self-refer 
to mental health and/or substance abuse services. 

Managed Care Programs for Behavioral Health Services 

Medicaid Waivers 

Seaion 1915(b) - HealthChoices Behavioral Health Services (HCBHS) - behavioral health stand-alone: 

Behavioral health services are delivered on a capitated basis. 

Medicaid Voluntary 

Voluntary HMO Contracts - general health - integrated: Operational in 28 counties; behavioral health 

services are included in I I of those counties. 




Other Managed Care Programs 
Not applicable. 



Geographic Location 

Section i9i5(b] - HCBHS: Five southeast counties 
(Philadelphia, Bucks, Chester, Delaware, and 
Montgomery). Ten more counties are expected to 
implement in the southwest part of the State before 
January 1999. Statewide implementation will be 
phased in. 



VolmtaryHMO Contracts. Allegheny, Amistrong, 
Beaver, Berks, Blair, Butler, Cambria, Cumberland, 
Dauphin, Erie, Fayette, Greene, Indiana, Jefferson, 
Lackawanna, Lancaster, Lawrence, Lehigh, Luzerne, 
Mercer, Monroe, Northampton, Northumberland, 
Schuylkill, Somerset, Washington, Westmoreland, 
and York Counties. 



July 31, 1998 



213 



Status of Programs 



Section i9i5(b] - HCBHS: Submitted March 1996,- 
approved December 31, 1996,- implemented 
February 1, 1997. 

Voluntary HMO Contracts: Implemented January 
1 , 1 972. Will be phased out when hIealthChoices is 
implemented statewide. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Acute detoxification,- inpatient (e.g., rehabilitation),- 
outpatient, opiate treatment programs (e.g., metha- 
done maintenance). 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Not applicable. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section i9i5[b) - HCBHS: Detoxification (e.g., non- 
hospital residential and rehabilitative inpatient 
detoxification); inpatient, outpatient (e.g., partial 
hospitalization),- mental health rehabilitation (e.g., 
behavioral mental health rehabilitation for children 
and adolescents, targeted case management, family- 
based mental health services for children and ado- 
lescents); crisis; mental health residential (e.g., resi- 
dential treatment facility (RTF) for children and 
adolescents). 

Voluntary HMO Contracts: Detoxification; inpa- 
tient (e.g., rehabilitation); outpatient (including par- 
tial hospitalization). 

Medicaid Mental Health Services in 
Managed Care Plan 

Section i9i5(b) -HCBHS: Inpatient; outpatient (e.g., 
partial hospitalization); mental health rehabilitation 
(e.g., behavioral mental health rehabilitation for 
children and adolescents, targeted case manage- 
ment, family-based mental health services for chil- 
dren and adolescents); crisis; mental health residen- 
tial (e.g., RTF for children and adolescents). 

Voluntary HMO Contracts: Outpatient (including 
early and periodic screening, diagnosis, and treat- 
ment (EPSDT) wraparound); inpatient (e.g., inten- 
sive care facilities, extended psychiatric hospitals), 
mental health rehabilitation (e.g., RTFs). 



Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Section i9i5[b) - HCBHS: EPSDT services. 
Coordination with primary care providers on 
screens for early identification of problems, and if a 
medical issue is identified, the behavioral rehabilita- 
tion services are offered. 

Voluntary HMO Contracts: EPSDT. 

Populations Covered Under Managed 
Behavioral Health 

Section i9i5(h) - HCBHS: Children and adults manda- 
tory: Aid to Families with Dependent Children/ 
Temporary Assistance for Needy Families (AFDC/ 
TANF), expanded coverage for pregnant women 
and children. Supplemental Security Income (SSI), 
general assistance. General assistance populations 
are funded by State-only and Federal general assis- 
tance. Gross income limits vary by county: The 
gross income limit in Philadelphia and Delaware 
Counties is $551. The limit for Bucks, Chester, and 
Montgomery Counties is $579. 

Voluntary HMO Contracts: Children and adults 
voluntary: AFDC/TANF, Federal general assistance, 
SSI (without Medicare), State-only categorically 
needy and medically needy. 

State Managed Care Program 
Administration 



Section i9i5(b] - HCBHS: The Office of Mental 
F4ealth and Substance Abuse Services (OMF4SAS), 
within the State Department of Public Welfare 
(DPW), contracted with five southeast counties to 
administer the behavioral health managed care pro- 
gram in their areas. Four of the counties contracted 
with a private, for-profit behavioral health MCO to 
handle day-to-day program operations. Phila- 
delphia County established a nonprofit organiza- 
tion to implement the program. 



214 



{SAMHSA} Managed Care Tracking System 



In the southwest region, OMHSAS plans to 
contract with three individual counties as well as a 
group of six counties, which submitted a proposal 
collectively. Allegheny County will subcontract 
behavioral health out to a consortium of mental 
health and substance abuse providers. Fayette and 
Beaver counties, as well as the six counties propos- 
ing together, are subcontracting their behavioral 
health services to a for-profit BHMCO. The State 
plans to contract directly with a private, for-profit 
MCO in one county area that did not submit a bid. 

Voluntary HMO Contracts: The Medicaid agency 
contracts with for-profit and nonprofit HMOs on a 
capitated basis. Rates are negotiated on an annual 
basis. The HMOs contract with primary care physi- 
cians and specialty providers. Referrals are required 
for mental health and substance abuse services. All 
HMOs subcontract behavioral health services. 

Financing of Plans 



Section i9i5[b) - HCBHS: Federal Medicaid and State 
general funds finance the program. As the primary 
contractor, the county is at risk for all medically 
necessary behavioral health in-plan service pay- 
ments,- it receives a capitated per-member per- 
month (PMPM) payment. Although four of the 
counties have transferred portions of this risk to 
their subcontractors, the counties retain ultimate fis- 
cal responsibility. Stringent fiscal solvency require- 
ments are contained in the State's contracts with the 
counties. 

Funds are blended at the State level. The south- 
east counties pay the behavioral health MCOs on a 
PMPM basis. Actuarially sound rate ranges were 
developed, and rates were negotiated within the 
range. 

Voluntary HMO Contracts: Medicaid contracts 
with HMOs who are at full financial risk and 
receive a PMPM capitated payment. Rates reflect a 
negotiated percentage for the PMPM cost to pro- 
vide benefits to a fee-for-service Medical Assistance 
Control population. The control population is 
divided into recipient groups on the basis of age, 
gender, and Medicaid program eligibility informa- 
tion, as well as county groups. The control popula- 
tion includes fee-for-service recipients whose 
enrollment into an HMO program is permitted by 
DPW policy. The State compiles the historic cost of 
the control population and applies changes that 



reflect trends in utilization and average price along 
with policy changes, to compute the PMPM cost to 
provide benefits during the agreement year. 
Payment provided by the agreement does not 
exceed the upper payment limit of what it would 
have cost the department to provide the same ser- 
vices under fee-for-service to an actuarially equiva- 
lent population. 

Coordination Between Primary and 
Behavioral Health Care 



Section i9i5[b] - HCBHS: The HealthChoices pro- 
gram contains detailed requirements for coordina- 
tion between the BHMCOs and the HMOs respon- 
sible for the physical health component of the 
HealthChoices program. Written agreements 
between the HMOs and BHMCOs must include 
provisions governing referral and coordination of 
emergency and nonemergency treatment, clinical 
information exchange, consultation, and training, 
and clinical and fiscal dispute resolution. 

Voluntary HMO Contracts: BHMCO subcontrac- 
tors coordinated behavioral health services. Primary 
care physicians coordinate care. 

Consumer-Family Involvement 



Section i9i5[b] - HCBHS: TTiere was very strong con- 
sumer, family, and other stakeholder involvement in 
the development of the HealthChoices behavioral 
health carve-out. Leadership came from a united, 
broad-based coalition of county commissioners, 
mental health and drug abuse administrators, 
statewide and local consumer and family-member 
organizations, and consumer advocates. Consumers 
and family members participated in the State evalu- 
ation of the proposals and served on the readiness 
review teams. 

in the southeast, consumers, family members, 
and advocates participate on several committees 
including Medical Assistance Coordinating 
Committee,- integrated Health Services Sub- 
committee,- Behavioral Health Managed Care 
Advisory Committee,- HealthChoices Southeast 
Consumers, Persons in Recovery, and Family 
Members of Behavioral Health Advisory 
Committee. 

Consumers and family members participate in 
the on-site monthly monitoring teams The 
Consumer Satisfaction Teams directly monitor the 



July 31, 1998 



215 



provision of services and report their findings to the 
count>'. Consumers and family members are also 
required to have input in the development of the 
reinvestment plans submitted by the counties. 

In the southwest, consumers, family members, 
and persons in recovery are required to have docu- 
mented input into the development of the county 
request for proposals (including the selection com- 
mittee) in the event that the county chooses to part- 
ner with a private BHMCO. Consumers, family 
members, and persons in recovery participated in 
the State's review of the proposals submitted for the 
HealthChoices program and will participate in the 
Readiness Reviews to be conducted prior to pro- 
gram implementation. 

Voluntary HMO Contracts-. None. 

Future Plans 

Section i9i5[h) - HCBHS: DPW will implement the 
program in the southwest in 1 999. The program will 
be rolled out in 10 counties in the Lehigh-Capitol 
region the following year. 

Voluntary HMO Contracts: Of the current 28 
counties within the voluntary program, 10 will 
become mandatory as of January 1, 1999. The 
remaining voluntary programs may expand into 
the 34 counties with no managed care program 
depending on the timing of implementation of 
HealthChoices. Once HealthChoices is imple- 
mented in any county, it replaces the voluntary 
program. 

State Agency Adnninistration 

The State's mental health and substance abuse 
authority resides in OMHSAS, which is housed in 
the DPW. The Office of Medical Assistance 
Programs, the State's Medicaid authority, is also 
under the DPW. There is a second, separate Bureau 
of Drug and Alcohol Program (BDAP), which is 
within the Department of Health. OMHSAS coor- 
dinates with the BDAP in designing and monitoring 
the HealthChoices program. 



Welfare Reform 



Pennsylvania's TANF plan was filed with the U.S. 
Department of Health and Human Services 
(DHHS) on January 22, 1997. It went into effect 
March 3, 1997. The plan stipulates denying benefits 
to drug felons and tests its recipients for drug use 
once an individual has been identified as needing 
treatment following an initial assessment. 

On July 31, 1997, Pennsylvania submitted 
another 1115 waiver to DHHS. This waiver is 
intended to help welfare recipients get into the 
work force. The program, entitled Common Sense 
Welfare to Work Project, emphasizes work and per- 
sonal responsibility and encourages people to 
become more self-sufficient. 

County 

The Integrated Delivery Network (IDN) for Youth 
and Families is being developed in cooperation with 
Allegheny County Department of Human Services. 
The pilot project, which involves 30 children enter- 
ing residential care, is scheduled to be implemented 
soon in Pittsburgh. Providers will receive an annual 
case rate. 

Evaluation Findings 

For the voluntary HMO program, annual reviews 
are conducted by the external quality review inde- 
pendent contractor. As the State moves forward 
with mandatory managed care, voluntary programs 
will mirror the same reporting requirements as the 
mandatory programs. Encounter data has been col- 
lected, which includes age groupings, diagnosis, eli- 
gibility group, expenditures, and category of ser- 
vices. Information is also being collected on perfor- 
mance outcome measures. 



Other Quantitative Data 

Not applicable. 



216 



{SAMHSA} Managed Care Tracking System 



RHODE ISLAND 



OVERVIEW 



Rhode Island operates two managed care programs that affect behavioral health. The State operates 
a physical health managed care program for Aid to Families with Dependent Children/Temporary 
Assistance for Needy Families (AFDC/TANF) populations, RIteCare, which aims to improve health 
services for low-income women and children through expanded Medicaid eligibility and increased 
access to physical health services as well as limited mental health and substance abuse services. This 
program excludes children with severe emotional disturbance (SED) and severe and persistent men- 
tal illness (SPMI) adults with serious mental illness (SMI). For detoxification services, the State 
Department of Health contracts with a substance abuse treatment provider to manage services, fund- 
ed by block grants and general revenue. 

A program for specialty mental health is on the horizon. It will be a pilot program for disabled 
individuals not included in the RIteCare program. A request for proposals (RFP) has been complet- 
ed, and the State has completed its initial selection process for partners for the program. 




Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 

Section 1115- RIteCare - general health - integrated: Provides primary and preventive care including 
mental health and substance abuse treatment, but services for adults with SMPI and SED children 
are carved out. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

Detoxification services - substance abuse stand-alone: Provides detoxification services funded through 

block grants and general revenue. 

RiCover - mental health stand-alone: Pilot project for disabled populations. 



Geographic Location 

Section ms - RIteCare: Statewide. 

Detoxijication services: Statewide. 

RICover: Initial implementation will be in the 
four attachment areas in the central portion of the 
State. 

Status of Programs 

Section ms - RIteCare: Submitted July 20, 1993,- 
approved November 1, 1993, implemented August 
1, 1994. 

Ddo-xijication services: Implemented July 1, 1996. 

RICover: Design phase. 



Medicaid Substance Abuse Services 
Remaining Fee-For^Service 



Residential substance abuse treatment programs 
(e.g., services for adolescents age 13 to 17) court 
order substance abuse services in which the court 
order specifies a nonnetwork provider 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Outpatient (e.g., individual, group, and famiK' ther- 
apy,- day treatment); inpatient (e.g., acute psychi- 
atric inpatient hospitalization), crisis (e.g., emer- 
gency room visits for psychiatric emergencies, crisis 
intervention); Institution for Mental Diseases 




July 31, 1998 



217 



(IMD) services for individuals under age 21,- mental 
health rehabilitation (e.g., community psychiatric 
supportive treatment, multidisciplinary psychiatric 
treatment planning, mobile treatment team). 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section ni5 - RIteCare: Opiate treatment programs 
(e.g., methadone maintenance, outpatient metha- 
done maintenance); residential substance abuse 
treatment programs (except for children age 1 3 to 
17); outpatient (e.g., day treatment, partial hospital- 
ization); collateral visits; medically necessary court- 
ordered services. 

Medicaid Mental Health Services in 
Managed Care Plan 

Section ms - RIteCare: Outpatient (e.g., day treat- 
ment, partial hospitalization); mental health resi- 
dential (except for residential treatment for children 
ordered by the Department of Children, Youth, and 
Families (DCYF); collateral visits; medically neces- 
sary court-ordered services. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Detoxijication services: Subacute and ambulatory detox- 
ification. 

RICover: Not yet determined. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 



Section iiis - RIteCare: Early and periodic screening, 
diagnosis, and treatment (EPSDT) services. 

Detoxijication services: Not applicable. 

RICover: Prevention will be an integral part of 
the overall program and interwoven through the 
other services. 

Populations Covered Under Managed 
Behavioral Health 

Section ms - RIteCare: Children and adults mandato- 
ry: AFDC/TANF, uninsured pregnant women and 
children up to age 18 up to 250 percent of Federal 
poverty level (FPL). 

Detoxijication services: Children and adults voluntary: 
Indigent, uninsured at or below 200 percent of FPL. 



RICover: Voluntary children and adults: Clinical 
criteria are used to determine eligibility. Clinical cri- 
teria include having a diagnosable mental, behav- 
ioral, or emotional disorder, or having been appro- 
priately classified as a "community support client" in 
the Rhode Island public mental health system prior 
to promulgation of the new project, and having a 
disorder that has resulted in functional impairment 
lasting 6 or more consecutive months substantially 
interfering with or limiting two or more major life 
activities. 

State Managed Care Program 
Administration 

Section Hi5 - RIteCare: RIteCare is administered by 
the Department of Human Service's Office of 
Managed Care. The Department contracts with 
four private, for-profit health maintenance organi- 
zation (HMOs), which are paid on a capitated basis. 
The Department of Health provides consultation 
on the program evaluation component of the pro- 
gram. Three HMOs subcontract out for mental 
health and substance abuse services to behavioral 
health managed care organizations. The HMOs are 
fully at risk for these services, subject to stop-loss 
provisions. The State Department of Human 
Services monitors mental health and substance 
abuse service provision as well as all other covered 
services. 

Detoxijication services: This program is managed 
by the Rhode Island Department of Health. The 
Department contracts with one provider to manage 
services. This firm is a not-for-profit corporation. 
The provider subcontracts certain components, 
including ambulatory methadone detoxification and 
residential adolescent detoxification, to other in- 
state, licensed treatment programs. The primary 
provider provides the residential detoxification ser- 
vices in two settings, one in Providence and one in 
North Kingstown. 

RICover: The Department of Mental Health, 
Retardation, and Hospitals will begin the program 
by contracting with four community mental health 
centers (CMHCs) that will be at partial risk. The 
State is considering the possibility of contracting 
with an administrative services organization (ASO) 
to assist with state-level data collection, medical 
management, and quality assurance. 



218 



{SAMHSA} Managed Care Tracking System 



Financing of Plans 






Section ms - RIteCare: The source of funds is 
Medicaid as well as Title XXI Children's Health 
Insurance Program (CHIP). The four HMOs partic- 
ipating in RIteCare are paid on a capitated, per 
enrollee, per month basis. The program includes 
cost-sharing requirements, either in the form of 
monthly premium payments or point of service 
copayments. Individuals whose income is below 
185 percent of FPL are not required to cost-share. 
Individuals whose income is between 185 percent 
and 250 percent of FPL are required to choose 
either monthly premium payments or copayments 
at the time services are delivered as their method of 
cost-sharing. Pregnant women between 250 percent 
and 350 percent of FPL pay both a monthly premi- 
um of about $106 to $118 and a copayment. 
Capitation rates were originally based on historical 
Medicaid fee-for-service (FFS) data. Rates are risk- 
adjusted by age and gender for all covered services. 
Mental health and substance abuse services in 
excess of stop-loss provisions are paid to the HMOs 
through the Medicaid FFS system. Budget neutrali- 
ty under RIteCare is based on constraining the 
growth in Medicaid expenditures that do not pro- 
duce savings. Providers are paid by the HMOs for 
mental health and substance abuse services on an 
FFS basis. 

Detoxijication services: The source of funds is com- 
bined State general revenue dollars and block grant 
funds. The managed care provider is paid monthly 
one-twelfth of the total contract amount. The 
agency is expected to serve all eligible Rhode 
Islanders, either on-site or through subcontracts. 
The provider is at risk in that the annual payment is 
capped, regardless of the number of eligible clients 
seeking services throughout the year. Rates for 
ambulatory methadone detoxification and adoles- 
cent residential detoxification are negotiated 
between the provider and the subcontractors. 

RlCover: The State plans to fund the program 
with Medicaid, Federal block grants, and State gen- 
eral fund dollars. The providers will be at partial risk 
defined by narrow risk corridors. 

Coordination Between Primary and 
Behavioral Health Care 



chosen health plan. Adults with SPMI and children 
with SED receive their physical health care through 
the health plan but receive their behavioral health 
care through Medicaid FFS (except for labs and pre- 
scriptions, which are in-plan-covered benefits). 
HMOs are required to coordinate members' physi- 
cal and behavioral health needs. 

Detoxification services: Not applicable. 

RICover: The State anticipates that physical 
health care will be on an FFS basis with a special rate 
designed for practitioners who agree to provide ser- 
vices on-site at a RICover provider agency. 

Consumer^Family Involvement 



Section Hi5 - RIteCare: Members receive both 
physical and mental health services through their 



Section ms - RIteCare: The Department of Human 
Services has a consumer advisory council (CAC) 
that meets monthly to discuss issues related to ser- 
vice access under Medicaid managed care. TTiere is 
a mental health and substance abuse subcommittee 
of the CAC. The CAC reviews materials prepared 
by the State to be distributed to members and has 
played a key role in the design of member-satisfac- 
tion surveys. 

Detoxijication services: Because the amount of time 
given to applicants to respond to the RFP was 
extremely short, no input from consumer or family 
members was sought. However, client-satisfaction 
surveys, which include opportunities to suggest 
changes in program design, are administered to all 
clients who access services. 

RICover: RICover evolved from a conference, 
heavily attended by consumers, on new paradigms 
in mental health services. RICover's steering com- 
mittee includes two consumer/family representa- 
tives. Additionally, the State is implementing a con- 
sumer advisory panel that will have its own paid, 
professional staff to assist in everything from design 
to ongoing monitoring. 

Future Plans 

Section ms - RIteCare: The State plans to submit an 
amended CHIP plan to the Health Care Financing 
Administration (HCFA) to cover the following 
groups under RIteCare: uninsured children up to 
age 19 up to 300 percent of FPL, uninsured par- 
ents/relative caregivers of children enrolled in 
RIteCare up to 250 percent of FPL, uninsured older 
siblings (ages 19-23) of children enrolled in 
RIteCare up to 250 percent of FPL, uninsured par- 



July 31, 1998 



219 



ents of children in Medicaid FFS up to 250 percent 
of FPL; and uninsured foster parents up to 250 per- 
cent of FPL. 

Detoxification services: The managed care entity 
has found that ambulatory detoxification services 
are often not effective for a highly dysfunctional, 
unstable population. The State is examining the 
effect of less use of ambulatory detoxification and 
more reliance on subacute services on the overall 
program budget. 

RICover: The State will continue to work on its 
benefit design, CMF4C readiness, and pricing 
methodologies in the near future and anticipates 
taking the first steps toward implementation in 
January 1999. 

State Agency Administration 



Welfare Reform 



The State Medicaid agency is the Department of 
F^uman Services. The adult mental health authority 
is the Department of Mental Health, Mental 
Retardation, and F4ospitals. The child mental health 
authority is DCYF The substance abuse authority is 
the Division of Substance Abuse, within the 
Department of FHealth. 



The State's TANF program became effective June 1 , 
1997. it denies benefits to anyone convicted of a 
crime involving the sale or distribution of drugs, it 
does not test recipients for drug use. 



County 

Not applicable. 



Evaluation Findings 



Section Hi5 - RIteCare: The Department has recently 
completed a Behavioral FHealth Access Study, and a 
Behavioral F-lealth Clinical Focused Study is in the 
analysis stage. As of March 31, 1998, the program 
has enrolled 75,S56 clients, 6,070 of whom repre- 
sent the uninsured pregnant women and children 
population,- 62.3 percent of enrollees are female,- 
37.7 percent are male. Only 2.9 percent of those eli- 
gible to change FHealth Plans during open enroll- 
ment chose to do so during the most recent enroll- 
ment period. The Department has an extensive 
monitoring and research program in place. 
RICover: Not applicable. 



Other Quantitative Data 

Not applicable. 



220 



{SAMHSA} Managed Care Tracking System 



SOUTH C AROLI N A 



OVERVIEW 



Currently, South Carolina Medicaid contracts with heahh maintenance organizations (HMOs) to 
provide the full range of Medicaid-covered services, including mental health, substance abuse treat- 
ment, and intervention services. This coverage is reimbursed up to $1,000 per recipient per year by 
the HMO, then by Medicaid on a fee-for-service (FFS) basis. The medically necessary services cover 
treatment in acute and long-term psychiatric and substance abuse care inpatient and outpatient set- 
tings. The Medicaid HMO contracts do not cover mental health and substance abuse prevention. In 
the mental health HMO agreement, selected case management and children's services are not includ- 
ed. Instead, these services are reimbursed on an FFS basis by Medicaid. The substance abuse HMO 
agreement includes case management services for all clients. There is a pilot project in the develop- 
ment stage to privatize mental health services for youth. 

A second managed care program implemented in selected areas of the State is the Physician 
Enhancement Program. Mental health and substance abuse services are excluded from coverage in 
this program and remain under an FFS reimbursement system for enrolled clients. 

Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 
Not applicable. 

Medicaid Voluntary 

Voluntary HMO program - integrated: HMOs licensed by the South Carolina Department of Insurance 
(SCDOI) and headquartered in South Carolina provide physical health, which includes acute care 
mental health and substance abuse services up to a $1,000 maximum benefit per enrollee.This pro- 
gram was implemented under the State Plan option; therefore, a waiver was not required. 

Other Managed Care Programs 

Child Welfare Privatization Initiative - mental health stand-alone: South Carolina was one of 12 states 
awarded a Robert Wood Johnson Foundation grant to set up a pilot project to develop a mental 
health managed care system for youth. 

Prior authorization - substance abuse stand-alone: Medicaid program, a coordinated delivery system of 
prior authorization for reimbursement of Medicaid substance abuse services. 



Geographic Location 

Volmlary HMO program: Counties. Each HMO that 
contracts with the Department of Health and 
Human Services (DHHS) provides services to indi- 
viduals enrolled in their service area as approved by 
SCDOI. As of June 1, 1998, 12 percent of the coun- 
ties were enrolled. Less than 1 percent of the 
Medicaid population is enrolled in the program. 

Child Weljare Privatization Initiative: One region 
initially (region not yet selected), with plans to go 
statewide. 

Prior authorization: Statewide. 



Status of Programs 






VblHMtory HMO /)ro^rflm: Implemented August 1, 1996. 

Child Weljare Privatization Initiative: Request for 
Questions (RFQ) released November 1997 and still 
under review. 

Prior authorization: Implemented ]u\y 1, 1997. 

Medicaid Substance Abuse Services 
Remaining Fee-For^Service 




Medicaid substance abuse treatment services 
include inpatient and outpatient (e.g., assessment, 



July 31, 1998 



221 



physical examination, detoxification, case manage- 
ment, crisis management, individual/group counsel- 
ing, day treatment, intensive in-home service, and 
therapeutic child care.) 

South Carolina Department of Alcohol and 
Other Dmg Abuse Service (DAODAS) has adopt- 
ed the American Society of Addiction Medicine, 
Patient Placement Criteria-2 (ASAM-PPC2) as the 
standard for patient placement using their levels of 
care and definitions. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 



Inpatient (e.g., psychiatric hospitalization),- outpa- 
tient (e.g., psychiatrist services),- residential (e.g., 
treatment facilities),- mental health support (e.g., 
targeted case management),- rehabilitation. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Voluntary HMO program: Substance abuse services 
include inpatient,- outpatient (e.g., early interven- 
tion, psychological testing, medical assessment, 
assessment counseling),- residential (e.g., intensive 
in-home services, high and moderate management 
group home services), acute,- subacute,- ambulatory 
detoxification. 

Prior authorization: Inpatient and outpatient (e.g., 
assessment, physical examination, detoxification, 
case management, crisis management, individual/ 
group counseling, day treatment, intensive in-home 
service, and therapeutic child care). 

Medicaid Mental Health Services in 
Managed Care Plan 

Voluntary HMO program: Mental health services 
include inpatient, outpatient, mental health support, 
rehabilitation, residential, and crisis. 
Prior authorization: None. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Child Welfare Privatization Initiative: Substance abuse 
services to be provided under this program have not 
been determined at this time. 



Non-Medicaid Mental Health Services in 
Managed Care Plan 

Child Welfare Privatization Initiative: Mental health ser- 
vices to be provided under this program have not 
been determined at this time. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Voluntary HMO program: All prevention services 
available on a FFS basis are included in HMO rate 
(e.g., adult physical). 

Child Welfare Privatization Initiative: Prevention ser- 
vices to be provided under this program have not 
been determined at this time. 

Prior authorization: None. 

Populations Covered Under Managed 
Behavioral Health 

Voluntary HMO program: Adults and children volun- 
tary: Aid to Families with Dependent 
Children/Temporary Assistance for Needy Families 
(AFDC/TANF),- Supplemental Security Income 
(SSI),- SOBRA. 

Child Welfare Privatization Initiative: The popula- 
tion to be served by this program is children in fos- 
ter care. 

Prior authorization: Adults and children mandato- 
ry: AFDCATANF 

State Managed Care Program 
Administration 

Voluntary HMO program: As of June 1, 1998, 
Medicaid contracts with three private, for-profit 
HMOs to provide services. One HMO contracts 
with a behavioral health organization (BHO), the 
other two contract with the State mental health 
authority (South Carolina Department of Mental 
Health). The BHO is a for-profit entity. 

The Department of Mental Health (DMH) and 
DAODAS contract with HMOs to provide behav- 
ioral health services up to the $ 1 ,000 limit. After the 
$1,000 limit has been met by the HMOs, Medicaid 
reimburses providers on an FFS basis. 

Any HMO that is licensed by the SCDOI as 
domestic and that contracts with the DHHS is eli- 
gible to participate. The DHHS (Medicaid) is 
responsible for monitoring the provision of services. 



222 



{SAMHSA} Managed Care Tracking System 



whether provided under the HMO contract (up to 
the $1,000 limit) or on an FFS basis (after the 
$1,000 limit has been met). The DMH and DAO- 
DAS are State authority providers for mental health 
and substance abuse services respectively. Both 
departments act as service providers under both the 
HMO and FFS options. HMO providers are 
responsible for ensuring the provision of mental 
health and substance abuse services through con- 
tractual arrangements with appropriate providers 
and payment for such services up to the $1,000 
limit. HMOs are responsible for maintaining a con- 
tractual relationship with appropriate providers to 
ensure the provision of the core benefits available 
under the HMO program. 

The HMOs are expected to develop and imple- 
ment a process to identify Medicaid HMO program 
members whose mental health needs may require 
extensive, specialty, or preventive intervention. 
DMH State staff may be required to participate in 
necessary continuity-of-care activities with the 
HMO for these members, including case consulta- 
tion and service linkage activities. Also, the HMO 
can make referrals to community mental health cen- 
ters (CMHCs). Oversight of the FFS inpatient 
Medicaid funds is assigned to DMH. 

Child Welfare Privatization Initiative: Under the 
pilot, the State will contract with one nonprofit 
managed care organization (MCO) for all child 
welfare services. The MCO will not be responsible 
for physical health services. Children covered under 
Medicaid will still receive some physical and mental 
health services from the State. The MCO will be 
required to ensure that care for children needing 
health and correctional services (not included in the 
pilot) is coordinated. 

Prior authorization: The Managed Care Division 
of DAODAS administers this program. The 
process of prior authorization of services has 
statewide accessibility through the County Alcohol 
and Drug Abuse Commissions, through a toll-free 
number during normal business hours and a 24- 
hour on-call reviewer. Training in the use of ASAM 
and the process of performing utilization review 
was provided throughout the state and will be 
ongoing. The DAODAS Managed Care Division 
consists of a director and six staff persons to admin- 
ister the program. 



Financing of Plans 



Voluntary HMO program: HMOs are licensed and 
headquartered in South Carolina and are paid a cap- 
itated rate, per member, per month, according to 
age, gender, and category of eligibility. Medicaid 
reimburses for behavioral health services up to 
$1,000. After that limit is reached, DMH and 
DAODAS reimburse on a FFS basis for mental 
health and substance abuse services provided, 
respectively, using State general funds. Placement of 
savings generated from the program is to be deter- 
mined. HMOs are allowed to retain profits in accor- 
dance with Department of Inurance (DOI) require- 
ments. HMOs are at full risk but must maintain rein- 
surance protection in accordance with DOI require- 
ments. 

Child Welfare Privatization Initiative: Under the 
pilot, there will be two bundled rates to finance the 
initiative: one includes Medicaid funds for behav- 
ioral health and targeted case management, the 
other includes Federal entitlement dollars (e.g.. Title 
IV-E, B) and State matching funds for all other ser- 
vices. Because a nonprofit MCO must be used under 
the Title IV-E restrictions, the state will share the 
risk with the MCO. There will be dollar incentives, 
however, for the MCO to stay within its budget and 
improve front-end services. 

Prior authorization: Medicaid dollars fund this 
program. 

Coordination Between Primary and 
Beliavioral Health Care 



Voluntary HMO program: DHHS and DMH have a 
memorandum of agreement that created an online 
communication system network with DHHS's 
Medicaid Management Information System. TTnis 
online system allows DMH staff to access DHHS's 
Medicaid files and match new clients with Medicaid 
clients to determine whether incoming clients are 
eligible for Medicaid benefits and are signed up to 
be in an HMO. DMH can determine, on a month- 
ly basis, the total number of clients who qualify for 
Medicaid and are in an HMO plan. 

The HMOs are required to develop and imple- 
ment a process to identify Medicaid HMO mem- 
bers whose mental health needs may require exten- 
sive, specialty, or preventive intervention. The 
HMO must provide the coordinatidn necessary 



July 31, 1998 



223 



for the referral of Medicaid HMO Program 
members to specialty providers and to out-of-plan 
services that may be available through FFS 
Medicaid providers. The HMO's behavioral health 
provider (mental health and substance abuse ser- 
vices) is required to participate in the necessary 
continuity-of-care activities with the HMO for the 
Medicaid members, including case consultation 
and service linkage activities. The HMO is also 
responsible for ensuring that coordination exists 
between the Supplemental Food Program for 
Women, Infants, and Children (WIC) and its 
network, provider. 

Child Welfare Privatization Initiative-. Physical and 
other types of child welfare services will be coordi- 
nated on an FFS basis. 

Prior authorization: Not available. 

Consumei^Family Involvement 

Voluntary HMO program: DHHS held several 
public hearings that allowed public input and feed- 
back on program policy and procedures for 
Medicaid delivery options. In addition, DHHS con- 
tinues to work with state agency providers in the 
development, implementation, and monitoring of 
program policy to ensure that issues of special needs 
populations are addressed in program design. 

Child Welfare Privatization Initiative: The steering 
committee and the agencies involved highly recom- 
mend consumer involvement and are exploring a 
process to include it. 

Prior authorization: Not available. 

Future Plans 



Voluntary HMO program: Future plans are to continue 
refining policies and procedures. 

Child Welfare Privatization Initiative: Will be imple- 
mented statev.'ide by January 1999. Future discus- 
sions will address the inclusion of medically fragile 
children in foster care. 

Prior authorization: None. 

* New Program Under Development: The South 
Carolina DMH is engaged in planning efforts to 
develop an organized system of care that will 
enable South Carolina's mental health system to 
meet the challenges of the health care reform 
movement. Planning is organized around three 
functional areas (quality, access, and cost) that form 



the basis for the Department's movement toward a 
system of care that will be viable in the behavioral 
health care market. Internally, DMH staff are 
involved in a number of activities aimed at devel- 
oping a better organized system of care. These 
include offering staff training, examining current 
commitment laws, developing utilization proto- 
cols, and refining management information. 
Currently, DHHS and DMH are collaborating on 
the best means of managing public behavioral 
health care in South Carolina. 

Elements of the organized system of care 
include 

• Some form of captitated or bundled rate pro- 
gram in consonance with the South Carolina 
DHHS, 

• Standardized utilization management protocols 
for community mental health services,- 

• Quality and outcome monitoring measures,- 

• Accrediting CMHCs with an outside accredi- 
tation agency such as the Joint Commission 
on Accreditation of Healthcare Organizations 
or the Commission on Accreditation of 
Rehabilitation Facilities,- and 

• A plan to re-allocate inpatient State funds to the 
community. 

Consumers have been involved in all phases of 
policy development and are members of the steer- 
ing committee for the organized system of care. 
The consumer affairs coordinator (CAC) for DMH 
and members of the following advocacy groups are 
on the committee: Alliance for the Mentally III, 
Mental Health Association, and Self-Help 
Association Regarding Emotions (SHARE). CACs 
have also been involved in developing the concept 
of the organized system of care. They serve as the 
key contacts for consumer involvement. 

* New Program Under Development: DMH will also 
explore the possibility of managing physical and 
behavioral health care for targeted populations such 
as individuals with serious mental illness. Thus far, a 
study of Medicaid recipients' mental health service 
use and the commitment to physical health care 
needs has been completed for a recent 6-month 
period. The data are currently being analyzed. The 
paced development of managed care in the state has 
lessened the movement toward managing physical 
and behavioral health care for targeted populations, 
but has not eliminated the interest in managing the 



224 



{SAMHSA} Managed Care Tracking System 



health care of the most seriously and persistently 
mental ill. 

State Agency Administration 



South Carolina's Medicaid, DMH, and DAODAS 
operate under three separate agency administra- 
tions. DHHS is the sole State authority for 
Medicaid services. DAODAS renders substance 
abuse treatment, and DMH provides both mental 
health and substance abuse treatment services. 

Welfare Reform 

• Clients identified by case managers as having a 
substance abuse problem are referred to DAO- 
DAS for evaluation and/or treatment. The refer- 
ral becomes a part of the client's Individual Self- 
Sufficiency Plan, and failure to go to DAODAS 
after referral is cause for a full-family sanction. 
Once treatment is successfully completed, the 
client is subject to random drug testing by 
DAODAS to ensure he or she is alcohol or drug 
free. If the testing finds substance abuse, the 
client must return to DAODAS for further 
treatment; failure to do so results in full-family 
sanction. Furthermore, if an AFDCATANF client 
commits a drug felony, TANF will be denied. 

• South Carolina submitted a Welfare to Work 
(WtW) plan on December 11, 1997, it was 
approved on February 29, 1998. The 
Employment Security Commission is the 
administering State agency. Matching funds for 
this grant will come from the State. The intend- 
ed use of the 1 5 percent of State funds includes: 
staff capacity building, transportation, child 
care, technology enhancement, and vocational 
rehabilitation (including substance abuse). 
The remaining 85 percent of funds will be split 

50/50 between poor individuals and TANF recipi- 
ents. Performance goals of the plan include: place- 
ment in unsubsidized jobs, job retention, and 
increase in earnings. 

WtW entities and TANF agencies will coordi- 
nate efforts through regional administrators who 
will develop a needs assessment of the TANF par- 
ticipant population. This assessment will form the 
basis of the WtW local plan and any requests for 
proposals. The WtW State plan will allow for the 



provision of mental health and substance abuse 
services, but it is the decision of the service deliv- 
ery area to contract with providers in order to 
make these services available to clients. 

County 

Not applicable. 

Evaluation Findings 

Voluntary HMO program: A formal evaluation of the 
HMO program is pending for program enrollment 
experience to assess cost, access, and quality of care. 
However, the HMO program has an ongoing exter- 
nal quality review component that is designed to 
assess HMO providers' compliance with the HMO 
contract requirements for quality, access, and avail- 
ability in the provision of core services. 

Child Welfare Privatization Initiative: Under this 
pilot, the State plans to conduct ongoing evalua- 
tions using a comprehensive monitoring and bench- 
mark system that is still in the early design stages. 
The State is also exploring possible alternatives for 
conducting a formal external evaluation. A prelimi- 
nary discussion has been made with an external 
entity to evaluate the program. 

DMH received funds from the Center for 
Mental Health Services to take part in a study to 
determine the feasibility of measuring performance 
indicators. South Carolina, along with four other 
States, will work during fiscal year 98 to form a 
common set of performance indicators and to test 
whether these indicators can be measured. 

The feasibility study has been completed and 
the final report sent to SAA4HSA and the Center for 
Mental Health Services. The indicators were 
defined and are in the final report. The data from 
the report are being re-analyzed by each state. The 
28 measures include clinical outcomes, consumer 
evaluation of care, consumer status, community ser- 
vices, and state hospital data. South Carolina was 
able to report 21 of the 28 measures. Several of the 
remaining data elements are under development. 

Other Quantitative Data 

Not applicable. 



July 31, 1998 



22S 



SOUTH DAKOTA 



OVERVIEW 



South Dakota operates a statewide primary care case management (PCCM) program under a 1 9 1 5{h) 
waiver, as well as a capitation program for mental health services for adults with severe and persistent 
mental illness (SPMl). Under the PCCM, referral is required for mental health and substance abuse 
services except for specialty mental health services for children with severe emotional disturbances 
(SEDs) and adults with SPMI. Under the Division of Mental Health's capitation program, payments 
are capped for SPMl and SED clients. 

Substance abuse services, funded by State general revenue funds, are not included in the capita- 
tion program. The Division of Alcohol and Drug Abuse, as the single State agency, provides case 
management for inpatient and outpatient clients. 

Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 

Section 1915(b) - South Dakota Provider and Recipient in Medicaid Efficiency (PRIME) case managenient 
program - PCCM model integrated: Mental health services are included in managed care, except for 
recipients diagnosed with SED or SPMl. Substance abuse services are included for adolescents under 
age 2 1 and pregnant women. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

CARE progran) - mental health stand-alone: Capitation program. 



Geographic Location 

Section i9i5(b) - PRIME. Statewide. 
CARE program: Statewide. 

Status of Programs 



Section i9i5(h) - PRIME: Originally submitted: 
unknown,- approved: unknown,- implemented July 1, 
1993. Renewal waiver submitted July 1, 1995. 
CARE program: Implemented July 1, 1997. 

Medicaid Substance Abuse Services 
Remaining Fee-For^Service 

Inpatient and outpatient services are available for 
adolescents under age 21 and pregnant women. 



Medicaid Mental Health Services 
Remaining Fee-For-Service 



Inpatient; outpatient,- Institution for Mental Diseases 
services for individuals 65 and over,- mental health 
rehabilitation (e.g., targeted case management). 

Medicaid Substance Abuse Services in 
Managed Care Plan 



Section i9i5(h) - PRIME: Inpatient, outpatient. 

Medicaid Mental Health Services in 
Managed Care Plan 



Section 19 i 5(h) - PRIME: Referrals required t^or inpa- 
tient and outpatient. 




July 31, 1998 



227 



Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

CARE program: Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

CARE program: Services available for SPMI adults 
include mental health residential, mental health 
rehabilitation (e.g., Programs of Assertive 
Community Treatment (PACT), and Continuous 
Assistance, Rehabilitation, and Education (CARE)). 
Services available for children with SED include 
mental health support (e.g., in-home services, case 
management, liaison), crisis (e.g., individual, group, 
crisis intervention),- outpatient (e.g., collateral con- 
tacts, assessment and evaluation, and psychological 
evaluation). 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section i9i5(b) - PRIME: Early and periodic screen- 
ing, diagnosis, and treatment services. 
CARE program: Not applicable. 

Populations Covered Under Managed 
Behavioral Health 

Section 19 i 5(b) - PRIME: Children and adults manda- 
tory: Aid to Families with Dependent 
Children/Temporary Assistance for Needy Families 
(AFDC/TANF), Supplemental Security Income 
(SSI), and low-income pregnant women,- low- 
income children (State Children's FHealth Insurance 
Program). 

CARE program: Adults voluntary: SPMI (defined 
according to State functional and diagnostic criteria). 

State Managed Care Program 
Administration 



Section i9i5(b) - PRIME: The Medicaid agency pays 
primary care providers a fee for referral services. 

CARE program: The Division of Mental F-lealth 
pays providers a capitated rate for units of care. A 
unit of service is 15 minutes of contact with a 
provider A maximum number of units is specified in 
each provider contract, with the stipulation that ser- 
vices must be provided to eligible recipients in the 
provider's designated catchment area throughout 



the duration of the contract period. Providers sub- 
mit claims for billable units on a monthly basis. The 
claims are paid up to the maximum amount prior to 
the end of the contract period. The maximum 
amount varies by provider. Some providers may 
reach their maximum amount prior to the end of the 
contract period, while others may not fully access 
the maximum amount. 

Financing of Plans 



Section i9i5[b) - PRIME: Medicaid and State dollars 
from the general fund finance this program. 

CARE program: Medicaid and State dollars from 
the general fund finance this program. Providers are 
paid $55 per day for SPMI consumers and $62 per 
hour for SED children's services. The fee was estab- 
lished by the Director of Mental F4ealth through 
negotiations with the executive directors of the 
mental health centers. 

Coordination Between Primary and 
Behavioral Health Care 



Section i9i5[b] - PRIME: Primary care physicians 
assist clients in gaining access to the health care 
system and monitor on an ongoing basis the 
client's condition, health care needs, and service 
delivery. 

The primary care physician is responsible for 
locating, coordinating, and monitoring all primary 
care and other medical and rehabilitation services 
on behalf of recipients enrolled in the waiver 
program. 

CARE program: Not applicable. 

Consumer^Family Involvement 



Section i9i5[b) - PRIME: Unknown. 

CAR£ program: Families and consumers serve as 
members of the State Mental F4ealth Planning and 
Advisory Council, which assists the Division of 
Mental FHealth in development of the State plan. 
Consumer advisory groups will be encouraged to 
become more active. 

Future Plans 

Section i9i5[b) -PRIME: Unknown. 

CARE program: The State plans to roll-in sub- 
stance abuse services. 



228 



{SAMHSA} Managed Care Tracking Systenn 



State Agency Administration 

The State's Medicaid authority is the Office of 
Medical Services, within the Department of Social 
Services. The mental health authority is the 
Division of Mental Health and the substance abuse 
authority is the Division of Alcohol and Drug 
Abuse, both within the Department of Human 
Services. 

Welfare Reform 



State plan under PL. 104-193 was filed with the 
U.S. Department of Health and Human Services on 
October 1, 1996, and became effective December 
1 , 1996. The program denies benefits to drug felons 
but does not test recipients for drug use. 



The State's Welfare-to-Work plan includes 
mental health and substance abuse provisions. 



County 

Not applicable. 



Evaluation Findings 



The Division of Mental Health has received a grant 
to perform outcome surveys of mental health clients 
and their family members. Areas being examined are 
quality of life satisfaction, access to services, quality 
of services, and culturally competent services. 

Other Quantitative Data 

Not applicable. 



July 31, 1998 



229 



TENNESSEE 



OVERVIEW 



Tennessee's managed behavioral health care program has gone through several iterations and con- 
tinues to make adjustments in design, organization, and hnancing. Currently, behavioral health ser- 
vices are carved out and provided under a separate program known as TennCare Partners. Two pri- 
vate behavorial health organization (BHOs) are responsible for managing the program. Nine private 
managed care organizations (MCOs) provide physical health services under TennCare. 

The behavioral health program has come under recent criticism for failing to provide needed ser- 
vices to patients with serious mental illness (SMI) and for contributing to the near deterioration of 
the traditional "safety net" mental health system. A series of improvements to correct problems iden- 
tified in the program are being implemented: 

1 . The State distributed $7.75 million to community mental health agencies facing financial crisis,- 

2. The State has taken over management of the behavioral health pharmacy program and 
assumed financial responsibility for the cost of four antipsychotic and three generic drugs, and 

3. The State Health Commissioner announced a proposed redesign of TennCare Partners that 
would, among other things, eliminate the program's priority population designation and give 
all enrollees access to the same benefit package, based on medical necessity. 

A waiver amendment will be submitted to the Health Care Financing Administration (HCFA) to 
implement the provisions in the redesign (see Future Plans Section). 

The State operates, separate from the TennCare program, a capitated mental health services pro- 
gram in correctional facilities. 



Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 

Section 1115 -TennCare - carve-out Covers general medical and behavioral health services on a capitated 
basis. Under an amendment, TennCare Partners carves out mental health and substance abuse services. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

MHM Correctional Services, Inc.- mental health stand-alone:The Tennessee Department of 
Corrections (TDOC) contracted with a private, for-profit behavioral health managed care organiza- 
tion (BHMCO) to provide capitated mental health services to the Tennessee prison system. 



Geographic Location 

Section ms - TennCare and TennCare Partners: 
Statewide. 

MHM Correctional Services, Inc.: Statewide. 

Status of Programs 



Section ms - TennCare: Submitted April 1993,- 
approved November 18, 1993,- implemented 



January 1 , 1 994. Amendment to Section 1115 waiv- 
er establishing TennCare Partners behavioral health 
carve-out submitted September 30, 1995, and 
approved April 4, 1996,- implemented July 1, 1996. 
MHM Correctional Services, Inc.: Contract awarded 
May 19, 1997,- implemented July 1, 1997. 




July 31, 1998 



231 



Medicaid Substance Abuse Services 
Remaining Fee-For^Service 



Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Pharmacy. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 

Pharmacy. 

Medicaid Substance Abuse Services in 
Managed Care Plan 



Section lii5 - TennCare Partners: 

Nonpriority population; Inpatient and outpa- 
tient (limited to a lifetime benefit of $30,000 with 
10 days detox coverage for the general TennCare 
population); crisis services,- transportation. 

Priority population: Additional unlimited ser- 
vices (inpatient, outpatient, transportation) provided 
to adults with SMI, children with severe emotional 
disturbance (SED), and children under early and peri- 
odic screening, diagnosis, and treatment (EPSDT). 

Medicaid Mental Health Services in 
Managed Care Plan 

Section ms - TennCare Partners: 

Nonpriority population; Inpatient (e.g., psychi- 
atric hospitalizarion for individuals between 22 and 64 
years old,- limited to 30 days per occasion, 60 days per 
enrollee); outpatient,- crisis services,- transportation. 

Priority population; Additional unlimited ser- 
vices provided to adults with SMI, children with 
SED, and children under EPSDT; mental health sup- 
port (e.g., case management, housing supports),- reha- 
bilitation (e.g., psychosocial),- specialized outpatient 
services,- residential (e.g., 24-hour care, housing). 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

MHM Correctional Services, Inc.: Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

MHM Correctional Services, Inc.: Outpatient (e.g., psy- 
chological testing, psychotherapy, evaluations, clin- 
ical supervision); pharmacy (management, drugs). 



Section liis - TennCare: EPSDT. 

MHM Correctional Services, Inc.: None. 

Populations Covered Under Managed 
Behavioral Health 



Section ms - TennCare: Adults and children mandato- 
ry; Aid to Families with Dependent Children/ 
Temporary Assistance for Needy Families 
(AFDC/TANF) (up to 185 percent federal poverty 
level (FPL)), Supplemental Security Income; option- 
al expansion for pregnant women and children; 
children up to age 19 and uninsured children below 
200 percent FPL who have access to health insur- 
ance but can't afford it (Children's F4ealth Insurance 
Program); uninsurables; uninsured children of any 
income level. 

TennCare Partners: TennCare population who 
meet medical necessity criteria; State-only SMI or 
SED whose incomes do not exceed FPL (do not 
receive TennCare medical/surgical benefits). 

MHM Correctional Services, Inc.: individuals within 
correctional system. Presenting clinical symptoms dic- 
tate the level of care and type of professional(s) 
required to meet the needs of the inmate/patient. 
Inmates/patients in need of mental health programmat- 
ic services must meet clinical and administrative admis- 
sion criteria for both inpatient and outpatient care. 

State Managed Care Program 
Administration 



Section iH5 - TennCare: The Tennessee Department of 
F4ealth (DOH) is responsible for the Tennessee 
Medicaid program and retains overall authority over 
the TennCare program. Within the DOF4, the 
Bureau of TennCare contracts with the nine MCOs. 

TennCare Partners: The Tennessee DOH has over- 
all responsibility for the TennCare Partners 
Program. DOFH contracts with two private, for- 
profit BHOs and is responsible for monitoring the 
BHOs to keep the program fiscally viable. 

All the services offered under the program are 
provided by one of the two BHOs under contract 
with DOH. The BHOs are responsible for organiz- 
ing and coordinating all the covered mental health 
and substance abuse services needed by their 
enrollees. Each BHO has developed a network of 



232 



{SAMHSA} Managed Care Tracking System 



providers including community mental health cen- 
ters (CMHCs) as well as specialty providers (e.g., 
Regional Mental Health institutes) who have tradi- 
tionally provided mental health services. Five 
CMHCs recently affiliated and formed a nonprofit 
entity in the Nashville area. The provider networks 
are reviewed by the TennCare Bureau quarterly to 
ensure availability of services. 

MHM Correctional Services, Inc.: The Tennessee 
Department of Corrections contracts with a private, 
for-profit BHMCO to place psychiatrists and psy- 
chologists in 22 prisons throughout the state. 

The State is responsible for ensuring that the 
quality of service delivery is maintained at an 
acceptable level and that inmates/patients requiring 
care receive the appropriate level of care in a time- 
ly and efficient manner. The State assists in the 
coordination and monitoring of doctoral level ser- 
vice delivery (e.g., development of outcome mea- 
sures, reviewing performance measures and staffing 
levels). The BHO is responsible for ensuring that all 
the clinical obligations outlined in the contract are 
provided for by qualified mental/medical health 
professionals. The BHO must have a provider net- 
work in place that promotes system-wide continuity 
of service delivery. 

Financing of Plans 

Section iH5 - TennCare-. This program is funded by 
Medicaid, State, and local dollars. 

In the early phases of TennCare implementa- 
tion, a blended capitation rate was used, in which 
Federal, State, and local expenditures for indigent 
health care were pooled. However, in July 1997, the 
State revised its method of capitation (pooled 
Federal, State, and local expenditures for indigent 
health care) and "unblended" its single capitation 
rate into two rates, one for the priority population 
(SMI) and one for the nonpriority TennCare popu- 
lation. This method is based on a fixed budget 
model. The two separate rates include the cost of 
psychotropic medications. The methodology and 
assumptions for "unblending" the behavioral health 
capitation rate is outlined below: 

• The State has fixed the total amount of expen- 
ditures available to the BHOs for the delivery of 
mental health and substance abuse treatment 
services and psychotropic medications to 



TennCare beneficiaries. This amount is approx- 
imately $325,750,000. 

• Forensic services were removed from the BHO 
capitation rate, reducing total expenditures by 
$22 million. 

• The capitation rate for the priority population 
was set by the State at $3 1 9.4 1 per member per 
month. 

• The capitation rate for the nonpriority mem- 
bers of TennCare will fluctuate based on the 
number of eligible members and the amount of 
money left after deducting the priority popula- 
tion capitation from the budget amount 
referred to above. 

In addition, the previous capitation rates were 
increased by 5 percent as of January 1, 1998. The 
BHOs are fully capitated and at risk. No risk corri- 
dors are in place to protect the BHOs. Providers are 
paid on a fee-for-service basis. 

MHM Correctional Services, Inc.-. The BHMCO 
receives a capitated rate and shares the risk with 
providers. The capitated rate for the TDOC 
inmate/patient population was established by the 
BHO. The State determined its financial tolerance 
level prior to bidding the contract. Therefore, the 
State was in a position to reject bids that exceeded 
the department's budgetary limits. Various historical 
and projected demographics were made available to 
all prospective bidders (e.g., general inmate popula- 
tion, diagnosed population, patients receiving psy- 
chiatric medications). There are no mandates as to 
how profits are to be spent. There is a risk corridor 
in place to protect the BHO. The capitated rate 
may be renegotiated if and when the TDOC inmate 
population significantly fluctuates from the original 
population projections that were submitted to the 
BHOs during the bidding process. The BHO is paid 
monthly for services rendered based upon the in- 
house population at the time of billing. 

Coordination Between Primary and 
Behavioral Health Care 



Section Hi5 - TennCare: The intent of folding 
TennCare Partners back into TennCare is that it will 
be easier and less confusing for people to get the 
health care they need from one responsible organi- 
zation. It is important tor enrollees, providers, and 
the State to have a single point of accountability. 



July 31, 1998 



233 



MHM Correctional Services, Inc.: The BHO has a 
chief psychiatrist and mental health program direc- 
tor who coordinate the delivery of psychiatric and 
psychological services. The TDOC Director of 
Mental Health consults with the chief psychiatrist 
or program director routinely to ensure that all ser- 
vices are being provided in an acceptable manner. 
Clinical data are collected and reviewed by all per- 
tinent professionals. Furthermore, the TDOC still 
has in place, at every facility, a State-employed 
mental health professional who assists in the coor- 
dination of services at their facility. The BHO's 
mental health program director coordinates month- 
ly meetings with his or her doctoral level staff,- 
issues such as service continuity, clinical supervi- 
sion, and medication management are discussed. 



stance abuse problems, and individuals with dis- 
abilities. 

Additionally, the State has agreed to increase 
the global funding for behavioral health services if 
TennCare enrollment exceeds 1.225 million people. 
MHM Correctional Services, Inc.: The TDOC is 
currently exploring the potential benefits of bidding 
out a comprehensive statewide health services con- 
tract that would include medical, mental health, and 
substance abuse services. Substance abuse services 
are currently contracted for a significant portion of 
the TDOC. 

* New Program Under Development: The State 
intends to commit $5.8 million over the next 5 years 
to develop a program for children and adolescents 
with SED through a Robert Wood Johnson proposal. 



Consumer-Family Involvement 

Section iiis - TennCare: Consumers were integrally 
involved in the development of the TennCare 
Partners Program waiver. Consumers are providing 
input to the State on the proposed fold-in of the 
Partners Program into the TennCare program. 

MHM Correctional Services, Inc.: Clinical consumer 
demographics were taken into consideration when 
designing this program. Family members were not 
involved. 

Future Plans 



Section iiis - TennCare: A waiver amendment will be 
submitted to F-ICFA for the following program 
improvements: 

1 . Eliminate the program's priority population des- 
ignations, giving all TennCare members access 
to the same benefit package, based on medical 
necessity,- 

2. Broaden substance abuse treatment benefits,- 

3. Impose a new set of financial penalties for inad- 
equate performance on the two BF-lOs, 

4. Require each BF^O to set aside $2.2 million per 
year for housing services, without financial risk 
beyond that amount,- 

5. Revise case management requirements to allow 
the level of case management to be determined 
on an individual basis,- and 

6. F^ire a program director for TennCare Partners 
and create three staff positions responsible for 
services covering children, persons with sub- 



State Agency Administration 

The Medicaid and Substance Abuse agencies are 
both under the DOF4. Medicaid is within the 
Bureau of TennCare. Substance Abuse is within the 
Bureau of Alcohol and Drug Abuse Services. Mental 
F4ealth is contained within its own department, the 
Department of Mental hlealth and Mental 
Retardation. 

Welfare Reform 

• Tennessee's Welfare to Work (WtW) grant was 
submitted to the U.S. Department of Labor on 
December 10, 1997, and is still pending 
approval. The plan will be administered by the 
Department of F^uman Services. Matching 
funds will come 100 percent from the State. 
The intended use of the 15 percent State pro- 
ject funds is incentive funding for private indus- 
try councils. The substate allocation formula for 
85 percent of the funds will be split: 50 percent 
to the poor, 37.5 percent to TANF recipients, 
and 12.5 percent to the unemployed. The coor- 
dination between local WtW entities and local 
TANF agencies is already in place under the 
State's welfare reform program. Families First. 
Performance goals will be determined in the 
first 6 months of the program but will include 
job retention targeting long-term welfare recip- 
ients and noncustodial parents and increased 
wages. 

• Under the State's TANF plan, drug testing is not 
mandatory for TANF recipients,- however, if a 



234 



{SAMHSA} Managed Care Tracking System 



TANF recipient is convicted of a dmg felony, he 
or she will be denied benefits. 

County 

Not applicable. 

Evaluation Findings 

1 . Section iiis - TmnCare: Many external and inter- 
nal evaluations have been conducted on 
TennCare. A few are highlighted below: 

• External review reports show that "patients 
who are denied care are not given the rea- 
son for refusal, not told of their right to 
appeal, and not given information about 
how to appeal — all of which are required 
by a Federal court order." 

• In a June 1997 report to HCFA, the State 
shared results from a survey it had conduct- 
ed showing that community mental health 
services had declined by 12 to 15 percent 
during the first 6 months of the TennCare 
Partners Program. 

2. A study commissioned by the Tennessee 
Association of Mental F^ealth Organizations 
found the following: 

• The monthly behavioral capitation rate for the 
priority population is $319.41. 

• The monthly behavioral health capitation 
rate for the nonpriority population, which 
will vary depending upon remaining funds, 
is estimated at $10.35. 



• An estimated 34 percent of the capitation 
rate for priority population is likely to be 
spent on medication. 

• An estimated 57 percent of the nonpriority 
population capitation is likely to be spent 
on medication. 

3. A study conducted by University of Memphis 
and University of Tennessee, published in the 
March 18, 1998, Journal oj the American Medical 
Association found that many patients lost access 
to care or lost continuity of care under the pro- 
gram. More specifically, researchers found the 
program spread funds previously earmarked for 
SMI patients across the entire Medicaid popu- 
lation. Many of the financially strapped centers 
stopped accepting new patients, discharged 
employees, or sought a buyout from for-profit 
managed care firms. Also, TennCare Partners 
adds a layer of administration — the BHOs — 
between the State and the intended beneficia- 
ries. This addition increases the structural com- 
plexity of the delivery system and reduces the 
resources available for patient care. The cre- 
ation of BHOs as separate behavioral health 
entities parallel to the general TennCare MCOs 
makes it difficult for both the State and con- 
sumers to identify the accountable party. 

Other Quantitative Data 

Section ms-TennCare: Enrollment is up to 1.265 mil- 
lion as of July 1998, from 1.07 million in March 
1998. 



July 31, 1998 



23S 



TEXAS 



OVERVIEW 

A new behavioral health stand-alone program in the Dallas area, to be implemented in 1999, will 
combine all mental health and substance abuse funding to serve Medicaid clients and the indigent. 
This model differs from other models being implemented in the State, which involve nonspecialty 
health maintenance organizations (HMOs) that subcontract for management of behavioral health 
services. 

Texas' Medicaid managed care program, known as State of Texas Access Reform or STAR, has 
historically encompassed three models; A full-risk HMO model, a partial-risk prepaid health plan, 
and a no-risk enhanced primary care case management (PCCM) model. These models, targeted pri- 
marily to individuals with acute care needs, have been implemented in six regions of the State. Under 
these models, acute, outpatient, and inpatient behavioral health care are provided and HMOs have 
some flexibility to offer nontraditional services within their capitation rate. Medicaid clients with 
serious mental illness (SMI) receive Medicaid Rehabilitation and Targeted Case Management 
through the Texas Department of Mental Health and Mental Retardation (TDMHMR). 

The new stand-alone model will be implemented on a pilot basis in 1999, with the newest roll- 
out of Medicaid managed care in the Dallas region. Using Medicaid, all State mental health funds, 
most chemical dependency State and federal funds. State general revenue, federal block grant funds, 
and local funds, the State plans to create a more seamless system of public behavioral health care for 
persons with acute, intermediate, and long-term care needs. Under this roll-out, known as 
NorthSTAR, mental health and substance dependency benefits will be carved out from STAR (the 
physical health plan) and managed by behavioral managed care organizations on a full-risk capitat- 
ed basis. Contractors will be required to subcontract with specialty provider networks (SPNs) for the 
treatment of individuals with SMI and severe emotional disturbance (SED). The SPNs include tra- 
ditional provider organizations that have historically delivered these specialized services in the 
NorthSTAR region. Chemical dependency/abuse benefits will include traditional Medicaid services 
and social medical or social model programs previously funded by non-Medicaid sources. 

Managed Care Programs for Behavioral Health Services 

Medicaid Waivers 

Section 1915(b) - STAR Health Plan - integrated: Provides inpatient, outpatient, and value-added mental | 
health services using HMO and PCCM models. I 

Section 1915(b) - NorthSTAR: Behavioral health stand-alone: provides mental health and substance | 

abuse services on a capitated basis. 

I Medicaid Voluntary | 

Not applicable. | 

i Other Managed Care Programs I 

I Section 1915(b): NorthSTAR- Behavioral health stand-alone: provides mental health and substance I 

I abuse services to Medicaid recipients and to medical indigents who are not in long-term care institu- 

I tions and who meet specific clinical criteria (e.g., SED, severe and persistent mental illness). Services 

P to Medicaid eligibles will be provided under 1915(b) waiver authority. 




July 31, 1998 237 



I Other Managed Care Programs (continued) 

Texas Integrated Funding Initiative: Mental health stand-alone: the State is piloting the pooling of public funds spent 
I among State and local agencies on children with SED and substance abuse/dependency problems. A 50 1 (c)(3) 
jl oj^ganization will manage care and use of pooled fundsThe projects are very close to implementation. 

Geographic Location 

Texas Integrated Funding Initiative: Two sites are 

Section i9i5fb)- STAR Health Plan VoWow'ing counties •„ i „ ^- *ii ■ i • ^ -r 

*■ ■' ° implementing,- one is still in planning stages. Iwo 

and contiguous areas: Travis, Bexar, Lubbock, jj... i .. /u *u u ^ i i 

* / / ( adaitional sites (both urban) are also in planning 

Tarrant, Jefferson, Galveston, Chambers, and . 

' -' ' I I stages. 

Harris,- STARPlus in Harris and Houston counties. 

In fiscal year 1998, this area constituted 19.48 per- Medicaid Substance Abuse Services 

cent of Medicaid eligibles. Remaining Fee-For^Service 

Section i9i5{h) - NorthSTAR: Dallas (urban), :,,,,^^^^^^^^^ 

Collin (suburban), Hunt (rural), Ellis (suburban), The following substance abuse services for adults 

Navarro (rural), Rockwall (suburban), and Kaufman remain in the fee-for-service system: outpatient and 

(suburban) counties. This area constitutes approxi- individual counseling (e.g., general acute hospital), 
mately 91 percent of Medicaid eligibles. 

Texas Integrated Funding Initiative: Three Mental Medicaid Mental Health Services 

It 1.L A ^^u ^ ^ u ^ / <• r^ Remaining Fee-For^Service 

Health Authority catchment area/counties. Une ° ., ™:~™v:.™— 

is an urban area (one county), one a suburban Jhe following mental health services are covered 

area (four counties), and one a rural area (two under Texas' Medicaid program: inpatient (e.g., hos- 

counties). pj^^l (30-day limit per spell of illness for adults, no 

limit for children), psychiatric services for individu- 

!*^*"^ °^'*'"°8^*'^^^__===.,=^^ als under age 2 1 , and age 65 and older (no limit)); 

Section i9i5[b] - STAR Health Plan: Implemented in outpatient (e.g., psychiatrists services: 30 encoun- 

Travis County and Southeast Region August 1, ters per calendar year, treatment beyond initial 30 

1993. Bexar County and contiguous areas: submit- encounters requires written prior authorization, 

tedonMay28, 1996; approved on August 30, 1996; nonphysician services (licensed psychologists, 

implemented on September 1, 1996. Lubbock I'censed master social workers-advanced clinical 

County: submitted on June 21, 1996; approved practitioners (LMSW-ACPs) and licensed profes- 

September 20, 1 996; and implemented October 1 , ^'o"^' counselors (LPCs) 30 encounters per calendar 

1996. Tarrant County: submitted June 20, 1990; y^^""' treatment beyond initial 30 encounters 

approved September 18, 1996; implemented on requires written prior authorization); rehabilitation; 

October 1, 1996. Harris County: submitted June ^"PP^^^ ^^-g' targeted case management); pharma- 

1997; and approved on October 10, 1997. Brazoria, ^^ (^'8 ' ''"^'ted to three per month per client unless 

Fort Bend, Montgomery, and Waller (these counties ^''^"^ is enrolled in Medicaid managed care). 

are the Harris county contiguous areas) counties: 

1 ^ J \^ u 1 lono Medicaid Substance Abuse Services in 

implemented on March 1, 1998. 

r n^ ^T ir-T-^n r- Managed Care Plan 

Section i9f5(pj - Norths I AK: Comments on ° :.u:i.;.=:™:.™™:™:^™=;^=^™.;™^ 

Request for Applications (RFAs) due May 1 8, 1 998; Section i9i5[h) - STAR Health Plan: 
RFA to be released June 25, 1998; applicant For members under age 21: inpatient; outpa- 
response due September 11, 1998; managed care tient; value-added services (e.g., day treatment; par- 
organizations (MCOs) named November 1, 1998; tial hospitalization; counseling, limited to 30 per 
contracts signed Febmary 1, 1999; waiver to Health calendar year unless medically necessary and prior 
Care Financing Administration, March 1, 1999; authorized), 
implementation July 1 , 1 999. For members over age 2 1 : outpatient; inpatient. 



238 



{SAMHSA} Managed Care Tracking System 



Section i9i5[b): NorthSTAR: inpatient detoxifica- 
tion,- outpatient; inpatient,- residential,- rehabilita- 
tion,- services for dually diagnosed. 

Medicaid Mental Health Services in 
Managed Care Plan 

Section iQislh) - STAR Health Plan: Inpatient,- outpa- 
tient,- value-added. 

Section i9i5(b] - NorthSTAR: Outpatient (e.g., 
screening, assessment, counseling, psychiatrist, psy- 
chologist),- pharmacy, emergency transportation, 
inpatient; rehabilitation. 

Outpatient counseling is limited to 30 visits 
unless additional visits are medically necessary and 
prior authorized for individuals over age 2 1 . HMOs 
may also provide social model flex benefits such as 
24-hour residential programs and other specialized 
services for people in clinical need of these services. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Section i9i5[h] - NorthSTAR: Inpatient detoxification; 
outpatient; inpatient; residential; rehabilitation; ser- 
vices for dually diagnosed. 

Texas Integrated Funding Initiative: Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 



Section i9i5(b) - NorthSTA^R: Outpatient (e.g., screen- 
ing, assessment, counseling, psychiatrist, psycholo- 
gist); pharmacy; emergency transportation; inpa- 
tient; rehabilitation. 

Texas Integrated Funding Initiative: A wraparound 
approach is being implemented to provide flexibili- 
ty for both formal and informal services. Examples 
include mentoring, tutoring, recreating, and school 
behavioral specialists. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section i9i5[h] - STAR Health Plan: Early and periodic 
screening, diagnosis, and treatment (EPSDT). 

Section i9i5(h] - NorthSTAR: Life skills training, 
all-stars program, promoting alternative thinking 
strategies, preparing for drug-free years, strengthen- 
ing families program for youth age 10 to 14 or 
equivalent models, funding HIV early intervention 
and outreach programs, infant intervention pro- 



grams for mothers, and reconnecting youth pro- 
grams for indicated populations. 

Texas Integrated Funding Initiative: TTie target popu- 
lation is children with more severe problems who 
tend to have higher service utilization and costs. 
The prevention is working toward keeping children 
in their communities, so they don't end up m resi- 
dential care. 

Populations Covered Under Managed 
Behavioral Health 

Section i9i5[b) - STAR Health Plan: Adults and chil- 
dren mandatory: Aid to Families with Dependent 
Children/Temporary Assistance for Needy Families 
(AFDCATANF); optional expansion pregnant 
women and children (up to 185 percent Federal 
poverty level (FPL)). Voluntary: Supplemental 
Security Income (SSI). 

Section i9i5[b) - NorthSTAR: Adults and children 
mandatory: AFDC/TANF; optional expansion preg- 
nant women and children (below 1 85 percent FPL); 
SSI; medically indigent (above 185 percent FPL). 
Individuals above 1 85 percent FPL are responsible 
for copays based on a sliding scale basis. 

Texas Integrated Funding Initiative: Voluntary: Any 
child is eligible based on availability and clinical 
need. 

State Managed Care Program 
Administration 

Section i9i5(b) - STAR Health Plan: The Texas 
Department of Health (TDH) contracts with for- 
profit and nonprofit HMOs and serves as a contract 
monitor and regulator. The HMOs' role is to pro- 
vide medically necessary services to the covered 
lives and meet required outcomes for their care. The 
State mental health authority's (TDMHMR's) role is 
to provide leadership in behavioral health policy, 
clinical, and program matters. TDMHMR is also 
statutorily required to develop standards for behav- 
ioral health in Medicaid managed care initiatives. 

All of the current HMO plans subcontract 
behavioral health to private, for-profit behavioral 
health managed care organizations (BHMCOs). 
BHMCOs contract directly with providers and 
community mental health centers to provide treat- 
ment. Long-term mental health services are avail- 
able and authorized through the local public mental 
health authorities, using Medicaid Rehabilitation 



July 31, 1998 



239 



and Targeted Case Management funds, as well as 
other State, local, and Federal revenue. 

Section i9i5[b] - NorthSTAR: TDMHMR and 
the Texas Commission on Alcohol and Drug 
Abuse (TCADA) intend to contract on a competi- 
tive basis with two MCOs. These MCOs can be 
HMOs or limited purpose HMOs. Limited pur- 
pose HMOs are HMOs that provide specialty ser- 
vices (e.g., behavioral health). A new licensure cat- 
egory allows community nonprofit providers to 
accept risk. 

These organizations will be responsible for net- 
work development and management, utilization 
review, quality management, and data management 
and analysis. MCOs (NorthSTAR plans) can be 
providers in their own networks but cannot be a 
local behavioral health authority (LBHA). The 
NorthSTAR Plans, in turn, will contract with a spe- 
cialty network to provide specialized services to 
SMI and SED clients. Specialty substance abuse ser- 
vices will be provided or monitored by an organized 
network under contract from the MCO. 

The program will establish a single LBHA for 
the seven-county region, eliminating the dual role 
currendy played by the area's five community men- 
tal health centers as providers and local authorities. 
Those centers will continue to have a role in the 
new program, with first right of refusal for creating 
the specialty network for adults and children. The 
LBHA will be a newly constituted independent enti- 
ty created for mental health and substance abuse 
purposes. Current mental health authorities will no 
longer be the designation for Community Mental 
Health and Mental Retardation Centers but rather 
the designation for autonomous entities in the ser- 
vice region. Local entities that provide the match 
for State mental health funds (largely county gov- 
ernments) in the seven counties would form the 
LBHA. TDMHMR and TCADA would contract 
with the LBHA to perform planning and oversight 
activities on behalf of the state and community. The 
LBHA cannot be an MCO or a provider in the 
MCO's network. 

Texas Integrated Funding Initiative: An administrative 
services organization (ASO) contracts with "any 
willing provider." The ASO is responsible to the 
funders for outcomes (funders can include mental 
health, juvenile justice, child welfare, substance 
abuse, education departments). 



Financing of Plans 

Section i9i5[b] - STAR. Health Plan. Medicaid, State, 
and Federal dollars finance this program. The TDH 
contracts with HMOs on a capitated basis and 
shares profits on a 50/50 basis. No stop-loss or rein- 
surance mechanisms are in place. This was devel- 
oped to prevent excessive profit incentives to the 
plans. 

The HMO capitation rate for behavioral health 
is blended into the capitated rate for physical 
health. Differential rates are established for client 
groups depending on risk. There are separate bene- 
fit packages for persons under age 2 1 and for per- 
sons age 21 and over. The State developed a maxi- 
mum capitation rate for each county and for each 
population category/risk group. Using fee-for-ser- 
vice data, State actuaries determined per-member 
per-month (PMPM) expenditures for each group 
with adjustments. Rates were discounted to reflect 
anticipated savings. 

The range of risk passed on to subcontractors 
ranges from full to none (e.g., paid on a fee-for-ser- 
vice basis). Subcontractor? are generally paid capi- 
tated rates when at risk. Some subcontractors are 
paid on a fee-for-service basis. 

Section i9i5[b) - NorthSTAR: Under the pilot. 
State general revenue dollars. Federal mental health 
block grant funds, and Medicaid dollars will be 
blended to fund the $93 million program. Local fun- 
ders who choose to participate with the LBHA will 
contribute their required local mental health match 
and may designate how those match dollars are to be 
used. The TCADA treatment dollars are included. 

At least two MCOs will bear full risk for pro- 
viding services to eligible populations. MCOs will 
be paid on a capitated basis while specialty care may 
be financed on a case rate or other reimbursement 
basis. Under the carve-out, the specialty network 
contract will include federal Projects for Assistance 
in Transition from Homelessness (PATH) funds for 
outreach to homeless mentally ill. Specialty pro- 
vider networks will negotiate the payment method. 

Capitation rates will be on a PMPM basis and 
calculated for identified population categories. State 
hospital bed usage has been included in the premi- 
um at its cash equivalent, and the MCOs will have 
the option of taking 5 percent of that amount and 
applying it to other services. Any direct service 
funds not used in achieving penetration rate targets 



240 



{SAMHSA} Managed Care Tracking Systenn 



or not expended to achieve the direct services fund- 
ing requirements will be reinvested the following 
year. Contractors will collaborate with the LBHA 
and the State to develop strategies to direct savings 
toward identified service priorities. 

Texas Integrated Funding Initiative: Funding streams 
can include child welfare, IV-E and IV-B funds, gen- 
eral revenue, city and county funds, noneducation 
funds, and Federal grants. Funds are integrated 
through the ASO, by contracts, and paid by the 
ASO. A case rate reimbursement is utilized at this 
time. 

Coordination Between Prinnary and 
Behavioral Health Care 



Section i9i5[b') - STAR Health Plan: Care is considered 
under this program through the following require- 
ments: 

• Quality assurance systems must integrate 
behavioral health. 

• Primary care providers and behavioral health 
specialists are required to share clinical infor- 
mation (with patient permission). Medical 
record review examines this parameter. 

• Focused studies examine physical/behavioral 
interface. 

• Local advisory committees integrate behavioral 
health perspective into STAR advisory commit- 
tee. 

Section i9{5[b]-NorthSTAR: The TDFH will oper- 
ate the Medicaid physical health care program in 
the Dallas service region through separate contracts 
with MCOs. it is the State agencies' intent to con- 
tinue the coordination of physical and behavioral 
health care delivery in the Dallas pilot. Current 
contractual requirements for provider communica- 
tion and coordination, provider training, and med- 
ical record integration will be improved. TDF4, 
TDMHMR, and TCADA will jointly monitor 
MCO performance in this area. 

Texas Integrated Funding Initiative: No efforts are in 
place at this time to coordinate physical and behav- 
ioral health care under this program. 



Services Commission (F4HSC) to solicit input into 
the 1915(b) waivers. Stakeholders do not have a 
formal role in implementation or oversight at the 
State level. On the service delivery level, HMOs 
must have representation of members receiving 
behavioral health services in their quality improve- 
ment processes. 

There is strong consumer involvement within 
the local mental health authorities. Advisory plan- 
ning committees must include at least 50 percent 
consumer representation. 

Section i9i5(b]: NorthSTAR: The contractor will 
provide a variety of opportunities for consumers of 
public behavioral health services and their families 
to have meaningful involvement in the design, 
implementation, operation, and oversight of 
NorthSTAR. The contractor will coordinate such 
activities with the LBHA. The contractor will also 
work with consumers and families to identify and 
develop opportunities for meaningful involvement 
and to inform consumers and families about the 
opportunities that are available. A broad coalition of 
advocacy groups has been engaged in a patient edu- 
cation campaign since October 1997. 

The contractor will provide opportunities for 
input from its provider network, community con- 
sortiums and advocacy groups, professional organi- 
zations, and representatives from local units of gov- 
ernment (e.g., the court and criminal justice system, 
education, child protective services). 

Tex^s Integrated Funding Initiative: Families con- 
tributed to the design of this waiver through focus 
groups, trainings, and planning meetings. 

Future Plans 



Consumer^Family Involvement 



Section i9i5[b) - STAR Health Plan: Meetings with 
consumer and advocacy organizations and public 
hearings were held by the Health and Human 



Section i 9 i 5{h) - STAR Health Plan: Statewide by 200 1 . 

Section i9i5[b) -NorthSTAR: See Status Section. 

Texas Integrated Funding Initiative: Two additional 
sites are in planning stages. Two current sites are 
implementing the program. 

* New Program Under Development: The TCADA 
and the TMDHMR released a request for proposals 
on April 20, 1998, to solicit proposals from coali- 
tions of mental health and substance abuse treat- 
ment providers to coordinate and adapt existing 
substance abuse and mental health services. 
Proposals are due September 1998. Contract will be 
awarded November 1998, and implementation is set 
to begin July 1999. 



July 31, 1998 



241 



* New Program Under Development: Texas will be 
implementing a child welfare demonstration in the 
Dallas/Fort Worth area. One primary contractor 
will be selected and responsible for delivering or 
subcontracting with other providers to deliver a 
continuum of placement, family reunification, and 
adoption services. The method of reimbursement 
has yet to be determined. 

• Based on TCADAs Statewide Service Delivery 

Plan, certain steps will be taken in the near 

future; 

>' Accept network applications for four 
regions, of which two regions will be 
accepted. 

>' Incorporate managed care tools to transi- 
tion to a system of network case manage- 
ment. These community-based networks in 
conjunction with local advisory groups 
such as the Regional Advisory Consortia 
will, over time, replace the current method 
of service delivery. 

>" Change funding allocation formula: move 
from six separate allocation formulas to a 
single formula that contains specific factors. 

>' Subdivide 1 1 service regions into 29 small- 
er subregions. TCADAs service system and 
funding allocation system will be designed 
around these subregions. 

>- Carve out substance abuse treatment/ 
prevention services to the Single State 
Authority (TCADA), which would then 
bid out services to public or private 
companies. 

State Agency Administration 

Medicaid, Mental Health, and Substance Abuse 
agencies are housed in three separate departments 
in Texas. The HHSC serves as the Medicaid 
agency TDMHMR and TCADA are the mental 
health and substance abuse agencies, respectively. 



Welfare Reform 



There are no initiatives in the State's welfare 
reform plan that specifically address public sec- 
tor behavioral health care clients. 
A number of persons on SSI because of their 
drug or alcohol dependence will be dropped 
from the rolls. Texas is projected to receive an 
additional $3 million in Federal block grant 
funds to serve these people as a first priority. 
TDMHMR and the TCADA are working to- 
gether to notify individuals of the availability of 
services with this funding. Currently, Texas does 
not require mandatory drug testing of TANF 
recipients, however, the State does deny TANF 
to those individuals convicted of drug felonies. 



County 

Not applicable. 



Evaluation Findings 



Section i9i5(b] - STAR Health Plan: HMOs are man- 
dated to conduct focused quality of care studies and 
are required to comply with Health Employer Data 
and Information Set (HEDIS) measures as well. 
Additionally, the Texas Health Quality Alliance is in 
the process of validating data submitted and con- 
ducting quality evaluation. Evaluation reports will 
be generated this fall. 

Section i9i5(b]: NorthSTAR: Examples of poten- 
tial evaluation activities include? 

Encounter data validation,- 

Medical record review,- 

Consumer satisfaction,- 

Local advisory groups,- and 

Analysis of complaints, prior authorization, 

and other access and quality issues. 



Other Quantitative Data 

Not applicable. 



242 



{SAMHSA} Managed Care Tracking System 



UTAH 



OVERVIEW 




Utah operates a public sector managed care program for mental health services under Medicaid. 
Substance abuse services remain in the fee-for-service system. Physical health services are provided 
through health maintenance organizations (HMOs) and primary care case management programs. 
The prepaid mental health plan (PMHP) was approved under a 1 9 1 5(b) waiver effective July 1 , 1 99 1 , 
which covers most of the State. The State has maintained the traditional mental health delivery sys- 
tem by contracting directly with community mental health centers (CMHCs) as managed care enti- 
ties. 

In June 1995, Utah submitted an 1115 health waiver request to expand Medicaid coverage to 
more low-income Utah residents and to simplify the eligibility process. The 1915(b) waiver for the 
PMHP will be subsumed into the 1115 waiver once it is approved, although mental health services 
will continue to be carved out in a separate program. New to the program will be a separate stand- 
alone plan for substance abuse services. The 1115 waiver, however, has not yet been approved and is 
on hold. For more information on this program, see the Future Plans Section. 

Managed Care Programs for Behavioral Health Services 

Medicaid Waivers 
I Section 1915(b) - PMHP - mental health stand-alone: Covers mental health services only. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 
Not applicable. 



Geographic Location 



Section i9i5(h) - PMHP: Implemented in 25 out of 29 
counties. Not implemented in San Juan, Daggett, 
Duchesne, and Uintah Counties. 

Status of Programs 

Section i9i5[h) - PMHP: Submitted in September 
1988,- approved in April 1990, implemented July 1, 
1991. 



Medicaid Mental Health Services 
Remaining Fee-For^Service 



Inpatient, outpatient; mental health rehabilitation 
(e.g., targeted case management),- prescription 
dmgs. 

Medicaid Substance Abuse Services in 
Managed Care Plan 



Section i9i5[b] - PPAHP: Not applicable. 



Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Outpatient, prescription dmgs. These services are 
covered by fee-for-service in two small mral areas 
only. 



Medicaid Mental Health Services in 
Managed Care Plan 



ff jT'fflVffi^rwy»v'TT'^^y~i'r:'i vr.''' V .".' 'iTiwm 



Section 19 i 5(h) - PMHP: Inpatient; outpatient; mental 
health rehabilitation (e.g., targeted case manage- 
ment). 



July 31, 1998 



243 



Non-Medicaid Substance Abuse Services In 
Managed Care Plan 

Not applicable. 

Non-Medicald Mental Health Services in 
Managed Care Plan 

Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section i9i5[b) -PMHP: PMHP contractors have the 
flexibility to provide prevention services appropri- 
ate to client need. Contractors provide a variety of 
psycho-educational groups, housing, and employ- 
ment support services, for example. 

Populations Covered Under Managed 
Behavioral Health 



Section i9i5[b] - PMHP: Children and adults manda- 
tory: Aid to Families with Dependent 
ChildrenATemporary Assistance for Needy Families, 
Supplemental Security Income (e.g., aged, dis- 
abled), medically needy, pregnant women, and chil- 
dren. 

State Managed Care Program 
Administration 

Section i9i5[b]-PA4HP: The Division of F-lealth Care 
Financing (DHCF) has sole-source contracts with 
eight CMF4Cs on a capitated basis for mental health 
services. The original three CMHCs in the program 
were selected through a competitive bidding 
process that included any entity that could provide 
either directly or through subcontract the inpatient 
and outpatient range of services to be covered. Five 
more CMF4Cs started contracts with the State on 
July 1, 1995. All PMF^P contractors subcontract 
with hospitals for inpatient psychiatric services, and 
all of them subcontract to some degree with select- 
ed community providers to provide outpatient men- 
tal health services. 

Financing of Plans 



paid a premium based on Medicaid aid category for 
every Medicaid recipient in the county, regardless 
of whether they use mental health services. Under 
capitation, CMHCs are free to negotiate discount- 
ed inpatient rates with hospital providers. If 
CMF4Cs are able to decrease inpatient expenses by 
increasing outpatient services, they are allowed to 
keep the inpatient savings. 

Coordination Between Primary and 
Behavioral Health Care 

Section i9i5[b] - PMHP: The PMF4Ps are required by 
contract to coordinate the provision of covered 
mental health services with the client's HMO and 
primary care physician. The contractors are also 
required to educate HMOs and primary care physi- 
cians on the diagnosis, treatment, and referral of 
behavioral health disorders commonly seen in pri- 
mary care. 

Consumer^Family Involvement 



Section {9i5[b] - PMHP: PMHP is financed through 
Medicaid dollars. The State pays the CMHCs 
directly. CMHCs are at risk for both inpatient and 
outpatient mental health services. The CMHCs are 



Section i9i5[b] - PMHP: Representatives from the 
Utah Alliance for the Mentally 111 were involved in 
the reviewing the responses to the "Formal 
Solicitation for Participation in a Prepaid Mental 
Health Plan" received from the five new PMHP 
contractors. DHCF will also invite representatives 
from consumer groups to participate in on-site visits 
to the contractors during the next waiver renewal 
process. Since implementation, representatives from 
the Utah Alliance for the Mentally 111 were invited 
to review and provide input into Medicaid's Third 
PMHP Operating and Monitoring Plan and are 
invited to review and comment on the PMHP con- 
tracts as they are revised. Representatives from 
Allies for Families, a children's mental health advo- 
cacy group, have been invited on contractor site vis- 
its to discuss access to and quality of children's ser- 
vices. In addition, family members and consumers 
are invited to the contractors' annual public hear- 
ings to provide feedback regarding services. 
Consumers and families will have the same role 
regardless of whether services are provided under an 
1115 or 1915(b) waiver. 

Future Plans 

Section i9i5[b') - PMHP: The State will let this pro- 
gram expire if the 1115 waiver is approved. The 



244 



{SAMHSA} Managed Care Tracking System 



Medicaid agency is currently planning to add sub- 
stance abuse services to the 1915(b) waiver effective 
January 1, 2000. PMHPs will receive separate pre- 
miums for substance abuse services. 

Section iH5 - Demonstration-. The State is awaiting 
approval of this waiver, which was submitted June 
30, 1995. An implementation date of January 1, 
2000, has been agreed upon by all parties. The 
waiver is intended to expand eligibility for services 
on a statewide basis. Mental health and substance 
abuse services would continue to be provided as a 
carve-out from physical health care services under 
the 1115 waiver as they are under the 1915(b) waiv- 
er. The PMHPs will be required by contract to 
coordinate the provision of covered mental health 
services with the client's HMO and primary care 
physician. The contractors will also be required to 
educate HMOs and primary care physicians on the 
diagnosis, treatment, and referral of behavioral 
health disorders commonly seen in primary care. 
During the next year, expenditure and utilization 
data will be gathered and analyzed to establish cap- 
itation rates. 

State Agency Administration 

The DHCF, within the Department of Health, is 
the State's Medicaid agency. The State's mental 
health (Division of Mental Health) and substance 
abuse authorities (Division of Substance Abuse) are 
in the Department of Human Services. 

Welfare Reform 



State plan under PL. 104-193 was filed with the 
U.S. Department of Health and Human Services 
(DHHS) on September 30, 1996, and became 
effective September 30, 1996. The plan requires a 
person with a drug felony conviction to receive 
treatment and make progress as a condition for 
receiving cash assistance. Recipients are not tested 
for drug use. 

Utah's welfare reform demonstration operates 
with a waiver under Title IV-A, Section 1 1 1 5, of the 
Social Security Act. The demonstration, entitled 



Utah Single-Parent Employment Demonstration 
(SPED), was one of the first welfare reform demon- 
stration projects to be approved by DHHS. The 
program imposes sanctions for failure to participate, 
requires children to attend school regularly, requires 
preschool children to receive immunizations unless 
the family has religious objections, defines a house- 
hold to include all related persons in the household 
(and all their incomes are included m the case unit), 
provides case management, increases resource lim- 
its, simplifies income rules to require families to 
report only monthly income fluctuation that 
exceeds $100, and increases Job Opportunities and 
Basic Skills (JOBS) participation requirements and 
activities. The program's amendments were 
approved July 1996,- it is authorized until December 
31, 2000. 



County 

Not applicable. 



Evaluation Findings 



An independent assessment of the PMHP has been 
conducted that included an extensive evaluation of 
services and outcomes for beneficiaries with schizo- 
phrenia and an evaluation of cost effectiveness. 
Medicaid has also submitted two waiver renewals 
reporting on access, quality, and cost. 

Other Quantitative Data 

The three contractors submitted client-specific 
shadow claims data for the first 4 years. The data 
were used to determine outpatient penetration rates, 
average amounts of services received, number of 
recipients with inpatient stays, number of inpatient 
admissions, readmission rates, and average lengths 
of stay, for example. The State is currently collect- 
ing client-specific encounter data from all eight 
contractors to conduct similar utilization analyses. 
A follow-up study on outcomes for beneficiaries 
with schizophrenia is also being conducted by the 
Division of Mental Health. 



July 31, 1998 



24S 



VERMONT 



OVERVIEW 

Vermont operates one statewide integrated Medicaid managed care program, Vermont Health 
Access Plan (VHAP), for acute care services. Health maintenance organizations (HMOs) implement 
the program. Behavioral health services are subcontracted to two types of organizations: 1) a non- 
profit joint venture between community mental health centers and a behavioral health managed care 
organization (BHMCO) and 2) a single for-profit BHMCO. 

For non-Medicaid mental health services, the Department of Developmental Disabilities and 
Mental Health Services (DDMHS) has begun a major restructuring effort that includes, among other 
managed care principles, a new case rate funding mechanism for people needing chronic mental 
health care services. This initiative is part of a system-wide restructuring effort for the public mental 
health system and will combine Medicaid and State mental health funds into a single service system. 

Non-Medicaid substance abuse services continue to be administered by the State substance abuse 
authority under the traditional grant system. 




Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 

Seaion 1 1 15 -VHAP - integrated: Acute behavioral health services are integrated into the waiver. Long- 
term services to people with chronic mental health disorders are not included and remain under the 
State mental health authority's administration (see Future Plans Section). 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

£)^N\.HS Restructuring - mental health stand-alone: Initiative to develop case rate funding mechanism 
for chronic mental health services. 



Geographic Location 



Section Hi5 - VHAP: Statewide. 

DDMHS Restructuring: Statewide. 



Medicaid Substance Abuse Services 
Remaining Fee-For-Service 



Detoxification; residential; inpatient; and outpatient. 



Status of Programs 

Section iiis - VHAP: Submitted February 5, 1995; 
approved July 28, 1995; implemented January 1, 
1996. 

DDMHS Restructuring: Case rate financing: 
October 1998; management information system: 
September 1998; designation criteria: January 1999; 
new client eligibility criteria: January 1998; perfor- 
mance indications/outcomes: July 1999. 



Medicaid Mental Health Services 
Remaining Fee-For^Service 



Inpatient; outpatient; Institution for Mental Dis- 
eases (IMD) services. 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section <<f5 - VHAP. Substance abuse services 
include inpatient; outpatient; detoxification, resi- 
dential. 



July 31, 1998 



247 



Medicaid Mental Health Services in 
Managed Care Plan 

Section ms - VHAP: Mental health services include 
inpatient; outpatient,- mental health support (e.g., 
group and individual treatment), pharmacy, rehabil- 
itation,- crisis,- residential,- IMD services (30 days per 
episode and 60 days per year). 

DDMHS Restructurtng: Not applicable. 

Non-Medicaid Substance Abuse Services 
in Managed Care Plan 



DDMHS Restructuring: Not applicable. 

Non-Medicaid Mental Health Services 
in Managed Care Plan 



DDMHS Restructuring: Not applicable. 

Substance Abuse Prevention and Mental 
Health Pronnotion in Managed Care Plan 



Sectton iiis - VHAP: None. 

DDMHS Restructuriy^g: None. 

The Department of Health collaborated with 
one major managed care organization (MCO) 
(same as under VHAP) that contracted with 
Medicaid to develop a training curriculum on sub- 
stance abuse prevention. The training is made avail- 
able on a voluntary basis to health care providers, 
doctors, nurses, etc. 

Populations Covered Under Managed 
Behavioral Health 



Section iiiS - VHAP: Adults and children mandato- 
ry: Aid to Families with Dependent Children/ 
Temporary Assistance for Needy Families (AFDC/ 
TANF), supplemental security income, uninsured 
adults (150 percent Federal poverty level). 

DDMHS Restructuring: DDMHS set formal func- 
tional and diagnostic criteria for client eligibility 
under their programs. 

State Managed Care Program 
Adnninistration 

Section iiis - VHAP: The Office of Vermont Health 
Access (OVHA) of the Vermont Department of 
Social Welfare (DSW), which is part of the Agency 
of Human Services, is responsible for Medicaid 
administration and is responsible for implementing 
the VHAP, 



OVHA has contracted with two private HMOs 
under the managed Medicaid program. Both HMOs 
subcontract with behavioral health organizations to 
manage and provide behavioral health services on a 
full-risk basis. One plan has entered into an agree- 
ment with the Vermont Behavioral Health 
Partnership (VBHP), a new public/private nonprof- 
it corporation composed of 10 community mental 
health, substance abuse, children and family spe- 
cialty programs, and a commercial behavioral 
health managed care organization (BHMCO). 
VBHP manages and provides acute behavioral 
health services to eligible beneficiaries. 

The other HMO has a subcontract with a pri- 
vate, for-profit BHMCO to manage and provide 
behavioral health care services. Under this arrange- 
ment, the BHMCO's responsibilities include utiliza- 
tion review, contracting, claims processing, provider 
network development, and service provision. 

DDMHS Restructuring: DDMHS has begun a ma- 
jor restructuring effort for the public mental health 
system that involves working with the following 
State agencies: the Departments of Corrections,- 
Social and Rehabilitation Services,- Health, Edu- 
cation, and Aging and Disabilities, the OVHA, and 
the Office of Alcohol and Drug Abuse Programs. 

The restructuring initiative stems from advo- 
cates calling for more responsive and effective ser- 
vices, increased concern about use of tax dollars for 
public services, and funding constraints due to State 
and Federal economic trends. The goal of the re- 
structuring initiative is to continue to improve ser- 
vices within the context of limited financial growth. 

Administrative changes involved in the restruc- 
turing effort include new criteria that provider agen- 
cies must meet to be designated as a preferred 
provider by DDMHS. In addition, DDMHS is 
developing system management tools to be used 
uniformly throughout the State, including practice 
guidelines, grievance procedures, system perfor- 
mance and consumer outcome indicators, and qual- 
ity assurance/quality improvement procedures. 

Financing of Plans 

Section iH5 - VHAP: VHAP is funded through 
Medicaid dollars for those individuals eligible under 
traditional rules, while the population that falls 
under the expansion to 150 percent Federal poverty 
level is funded through an increase in cigarette taxes 



248 



{SAMHSA} Managed Care Tracking System 



that is used as the State match for Medicaid. HMOs 
are capitated, but the State provides stop-loss cov- 
erage and reinsurance. Capitation rates are based on 
age, not severity or experience. Both HMOs off- 
load risk to their behavioral health subcontractors. 
Both subcontractors receive capitation payments 
based on those provided to the HMOs. 

DDMHS Restructuring: Combining Medicaid and 
general funds, DDMHS developed a single system 
of payment (e.g., case rates) for all public sector 
mental health clients v/ho need long-term-care ser- 
vices. More specifically, major components of the 
framework for the payment system are 

• Case rates for Community Rehabilitation and 
Treatment (CRT) services and Developmental 
Services (DS),- 

• Capitation and fee-for-service payments for 
emergency services,- 

• Risk and incentive pools separate from the 
funds used for CRT and DS case rates and 
Emergency Services capitation rates,- and 

• Investment and risk corridor for gains and loss- 
es in the CRT, DS, and Emergency Services 
programs. 

Coordination Between Primary and 
Behavioral Health Care 



Section iiis - VHAP: Coordination is the responsi- 
bility of the HMO plans, which use a primary care 
physician model. Physical health providers commu- 
nicate with behavioral health providers by agree- 
ment,- no mandate is in place. After the first behav- 
ioral health visit, the primary care physician is 
involved in referring and approving behavioral spe- 
cialty services. 

DDMHS Restructuring: Not applicable. 

Consumer^Family Involvement 



Section ms - VHAP: Consumer and family involve- 
ment has been through advocacy groups and 
OVHA advisory committees. 

DDMHS Restructuring: Under the DDMHS 
restructuring effort, one of the major goals is to 
increase family and consumer involvement in evalu- 
ation, policy setting, and governance. A new State 
Quality Performance Council is being formed, and 
local standing committees for CRT, Children's 
Services, and DS programs are the primary vehicles 
through which consumers and family members can 



participate more fully in the system. In addition, a 
State Quality Council for Adult Mental Health is 
also being formed. The composition of this board 
would be at least 51 percent consumers and family 
members. It will be concerned with quality issues 
affecting services for adults with serious mental ill- 
ness in the managed care program. 

Future Plans 

Section Hi5 - VHAP: A new managed care informa- 
tion system will become operational online by 
September 1998. 

DDMHS Restructuring: See Status of Programs 
Section. 

State Agency Administration 



Vermont's Agency of Human Services houses 
Medicaid, Mental Health, and Substance Abuse. 
Medicaid falls under the DSW, Mental Health 
under DDMHS, and Substance Abuse under the 
Office of Alcohol and Drug Abuse Programs, with- 
in the Department of Health. 

Currently plans for restructuring within 
DDMHS include consolidating administration of 
some children's and substance abuse services and 
some functions such as management information 
systems. 

Welfare Reform 



Vermont's Welfare Restructuring Project, the 
nation's first statewide demonstration of time-limit- 
ed welfare, was implemented following receipt of 
Federal waivers in April 1993 and the General 
Assembly's enactment of Act 106 in January 1994. 
Under this project, mandatory drug testing is not 
required of individuals and if an individual is con- 
victed of a drug-related felony, he or she will be pro- 
vided TANF assistance until at least June 1998. 



County 

Not applicable. 



Evaluation Findings 

Section ms - VHAP: Evaluations on cost, outcome, 
and access are being conducted. 

Other Quantitative Data 

Not applicable. 



July 31, 1998 



249 



VIRGIN I A 



OVERVIEW 



Virginia's first experiences with managed care came in the early 1990s when the Department of 
Medical Assistance Service (DMAS) implemented the Medallion program. Medallion is a managed 
fee-for-service (FFS) program available in most parts of the State. 

In 1995, the legislature voted to expand the Medallion program and required the DMAS to pilot 
a mandatory Medicaid managed care plan. DMAS implemented this plan (known as Medallion II) in 
seven Tidewater localities. Some mental health and substance abuse services are included for Aid to 
Families with Dependent Children (AFDC) and Aged, Blind, and Disabled populations. HMOs sub- 
contract with community service boards (CSBs) in the current Medallion II areas. A legislative man- 
date to implement Medallion II in another area directs outpatient services be paid FFS direcdy to 
CSBs (outpatient mental health services are excluded from HMO rates). 

In addition, the Department of Mental Health, Mental Retardation and Substance Abuse Services 
(DMHMRSAS) has implemented a case rate pilot project for individuals with serious mental illness 
(SMI) and severe emotional disturbance (SED). 




Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 

Section 1915(b) - Medallion II - general health - Integrated: Provides physical health as well as limited 

mental health services. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

Priority Populations and Case Rate Funding Pilot - mental health stand-alone: Applies managed care tech- 
niques for individual services, planning, and delivery. 



Geographic Location 

Section i9i5(b) - Medallion 11 Statewide. 

Priority Populations and Case Ratf. Funding Pilot. 
Unknown. 



Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Outpatient (e.g., day treatment) and residential sub- 
stance abuse treatment programs for pregnant 
women and parents with dependent children. 



Status of Programs 



Section {9i5(b] - Medallion IL Submitted: unknown,- 
approved: unknown, implemented January 1, 1996. 
Renewed: unknown. 

Priority Populations and Case Rate Funding Pilot: 
Implemented July 1, 1997. 



Medicaid Mental Health Services 
Remaining Fee-For-Service 

Inpatient; Institution for Mental Diseases services 
for individuals under age 22 and over age 65: out- 
patient (e.g., clinic services), mental health rehabil- 
itation (e.g., targeted case management). 



July 31, 1998 



251 



Medicaid Substance Abuse Services in 
Managed Care Plan 



Section i9i5[b] -Medallion IL Not applicable. 

Medicaid Mental Health Services in 
Managed Care Plan 

Section i9i5(h] -Medallion IL Inpatient,- outpatient. 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Priority Populations and Case Rate Funding Pilot: Not 
applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 



Priority Populations and Case Rate Funding Pilot: Mental 
health residential,- mental health rehabilitation. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section i9i5[h] - Medallion IL Early and periodic 
screening, diagnosis, and treatment (EPSDT) ser- 
vices. 

Priority Populations and Case Rate Funding Pilot: 
Unknown. 

Populations Covered Under Managed 
Behavioral Health 



Section i9i5[b] - Medallion IL Children and adults 
mandatory: AFDCTTANF (Temporary Assistance for 
Needy Families) and Supplemental Security Income. 
Priority Populations and Case Rate Funding Pilot: 
Voluntary children and adults: uninsured and under- 
insured. 

State Managed Care Program 
Administration 

Section i9i5(b] - Medallion IL The DMAS contracts 
with private, for-profit health maintenance organi- 
zations (HMOs) on a full-risk basis. Some FHMOs 
subcontract with CSBs, which have formed a 
statewide partnership that represents them as a 
legal entity with FHMOs. This partnership operates 
under an exemption to antitrust laws and competes 



for public and private contracts. One F4MO has an 
exclusive contract with five CSBs through this 
partnership. 

Priority Populations and Case Rate Funding Pilot: 
DMHMRSAS contracts with public CSBs, which 
are paid a case rate for services provided. 

Financing of Plans 



Section i9i5[b) - Medallion IL Medicaid funds this pro- 
gram. DMAS makes capitated payments to HMOs 
under a full-risk arrangement. The HMOs are paid 
a monthly fee per member. These rates are based on 
pre- HMO Medicaid costs. The rates are broken 
down by age, sex, locality, and if a client is aged, 
disabled, or other. 

Priority Populations and Case Rate Funding Pilot 
State-only dollars funds this pilot. The State pays 
CSBs a case rate for services provided. 

Coordination Between Primary and 
Behavioral Health Care 



Section i9i5[b) - Medallion IL Coordination of these 
services is performed according to the HMO pro- 
cedures. 

Priority Populations and Case Rate Funding Pilot: Not 
applicable. 

Consumer-Family Involvement 



Section i9i5[b] - Medallion IL One subcontracted CSB 
has established its own hotline for managed-care- 
related complaints and has served as an ombudsman 
program in its service area. 

Priority Populations and Case Rate Funding Pilot: 
Unknown. Strategies for Increasing Client and 
Family Involvement is a project that increases con- 
sumer and family involvement and participation in 
service planning, delivery, and evaluation of pub- 
licly funded mental health, mental retardation, and 
substance abuse services. The project uses a Best 
Practices Report Card to evaluate progress in this 
area. 

Future Plans 

Section i9i5(b] - Medallion II: Unknown. 

Priority Populations and Case Rate Funding Pilot: 
Unknown. 



252 



{SAMHSA} Managed Care Tracking System 



State Agency Administration 

The Medicaid authority is the DMAS. The mental 
health and substance abuse authority is the 
DMHMRSAS. 

Welfare Reform 

Virginia filed a State plan under PL. 104-193 with 
the U.S. Department of Health and Human 
Services on December 6, 1996. The plan became 
effective February 1, 1997. The program denies 
benefits to drug felons but does not test recipients 
for drug use. 

County 

Not applicable. 



Evaluation Findings 



Performance and Outcome Measurement System (POMS): 
The State Medicaid agency has developed a mech- 
anism for the routine assessment of consumer out- 
comes and provider performance, frequendy as part 
of an overall strategy of managed care. Through 
POMS, provider and system performance is 
assessed on several dimensions, including access to 
services, quality/appropriateness of care, consumer 
outcomes, inter-system performance, and con- 
sumer/family participation. A pilot project is cur- 
rently being conducted to test the effectiveness of 
POMS and identify needed refinements. 

Other Quantitative Data 

Not applicable. 



July 31, 1998 



2S3 



WASH I NGTON 



OVERVIEW 



Washington currently operates two managed care programs affecting public sector behavioral health 
services. First, the Integrated Community Mental Health Program is an integrated managed care 
waiver program for community inpatient and outpatient mental health and rehabilitation services, 
Washington's statutorily based local mental health authorities are responsible for the program 
(Regional Support Networks (RSNs)). Some mental health authorities manage the program them- 
selves, while others have contracted with private administrative services organizations (ASOs). 

To date, all RSNs established by Washington's Mental Health Reform Act of 1989 have chosen 
to become prepaid health plans (PHPs). 

Second, Washington's basic health plan (BHP) is a State-sponsored physical health managed care 
program that provides some mental health/substance abuse benefits to uninsured individuals. 

Chemical dependency services are not included under a specific managed care program at this 
time, except for those limited services provided under BHP for the uninsured and underinsured. All 
Medicaid substance abuse services provided to public assistance recipients are managed by the 
Division of Alcohol and Substance Abuse (DASA) using managed care principles but not contracted 
through managed care entities. These services are provided on a fee-for-service basis. 




Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 

Section 1915(b) - Integrated Comnriunity Mental Health Program - mental health stand-alone: Provides 

capitated community psychiatric Inpatient, outpatient, and rehabilitation services. 



Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 

BHP - integrated: State-sponsored program that provides limited mental health and substance abuse 

services to working individuals without insurance and other uninsured individuals. 



Geographic Location 



Section {9i5[b] - Integrated Community Mental Health 
Program: Statewide. 
BHP: Statewide. 



Medicaid Substance Abuse Services 
Remaining Fee-For^Service 



Hospital-based detoxification,- opiate treatment,- 
outpatient. 



Status of Programs 



Section I9i5[b] - Integrated Community Mental Health 
Program: Submitted December 1996,- approved and 
implemented July 1, 1997. 

BHP: Implemented behavioral health services in 
1995. 



Medicaid Mental Health Services 
Remaining Fee-For^Service 



Inpatient; rehabilitation, pharmacy,- support (e.g., 
personal care),- outpatient (e.g., individualized treat- 
ment services),- inpatient mental health care for 
those under age 2 1 . 



July 31, 1998 



255 



Medicaid Substance Abuse Services in 
Managed Care Plan 

Section i9i5(b] - Integrated Community Mental Health 
Program: Not applicable. 

Medicaid Mental Health Services in 
Managed Care Plan 



Section i9i5[b] - Integrated Community Mental Health 
Program: Inpatient (e.g., psychiatric sen/ices),- crisis,- 
mental health support (e.g., stabilization services, 
medication management),- outpatient (e.g., individ- 
ual and group treatment services, adult day treat- 
ment, intake evaluation, special population evalua- 
tion, interdisciplinary evaluation for nursing home 
residents, psychological assessment),- rehabilitation 
(e.g., adult and child acute diversion services, child 
and adolescent day treatment, family therapy). 

In addition, higher-need clients receive individ- 
ualized care planning (e.g., intensive community 
support, wraparound services, and other compara- 
ble services that do not necessarily involve treat- 
ment teams). 

Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

BHP: Chemical dependency treatment benefits 

(e.g., inpatient, residential, outpatient) are limited 
to a maximum of $5,000 in a 24 consecutive calen- 
dar month period and a lifetime maximum of 
$10,000. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 



BHP: Inpatient (up to 10 days per calendar year),- 
outpatient (up to 12 visits per year). 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Section i9i5(b') - Integrated Community Mental Health 
Program: RSNs use State-only and Federal block 
grant dollars for prevention services. Typically, 
these services fall under the rehabilitation service 
option. 

BHP: Unknown 



Populations Covered Under Managed 
Behavioral Health 

Section i9i5[h] - Integrated Community Mental Health 
Program: Aid to Families with Dependent Children/ 
Temporary Assistance for Needy Families (AFDC/ 
TANF), Supplemental Security Income, categorical- 
ly and medically needy, optional expansion preg- 
nant women up to 1 85 percent Federal poverty level 
(FPL) and children up to 200 percent FPL. 
BHP: Underinsured and uninsured. 

State Managed Care Program 
Administration 

Section i9i5[b) - Integrated Community Mental Health 
Program: The Integrated Community Mental F4ealth 
Program is administered by the Mental F^eaIth 
Division (MHD) within the Department of Social 
and F^ealth Services. The MFHD has contracted 
with 14 PF^Ps that are regional county-based orga- 
nizations (e.g., RSNs). MFHD oversees and adminis- 
ters the statewide public system (e.g., sets policy,- 
ensures an accountable system, defines covered lives 
and minimum services,- licenses providers,- sets per- 
formance standards and outcomes,- ensures maxi- 
mum amount of services, and operates state hospi- 
tals). RSNs are designated as the single point of 
local responsibility for mental health services under 
State statute. The 14 RSNs that operate the man- 
aged care program are single or multiple county 
administrative organizations (6 are multiple county 
administrative organizations). These RSNs subcon- 
tract with community mental health centers for ser- 
vice delivery. Two RSNs have partnerships with pri- 
vate behavioral health managed care organizations 
(BF^MCOs). The RSNs are accountable to the 
Mental F^ealth Division of the Department of 
Social and Health Services. The RSNs role is as pur- 
chaser and manager of services. They ensure a 
seamless system of mental health services to meet 
individuals' needs. Under the integrated system, 
RSNs 

• Create and maintain administrative structure 
across the PFHP (central advisory board, central 
fiscal structure); 

• Ensure access for all covered lives, 

• Develop and maintain provider network (The 
provider network depends on the geographical 
location, whether urban, suburban, or rural. 



2S6 



{SAMHSA} Managed Care Tracking System 



The State has licensed more than 150 agencies 
who do business in some form with the 14 

RSNS.); 

• Maintain a case management system (e.g., prior 
authorization, concurrent review and retrospec- 
tive review); 

• Ensure consumer satisfaction,- 

• Ensure outcomes and provide MHD with data 
on outcomes,- 

• Maintain profiling and credentialing system, 
and 

• Administer a portion of State hospital budget. 
BHP: The Washington State Health Care 

Authority (HCA) contracts with 14 health plans 
under BHP. 

Financing of Plans 

Section i9i5[b) - Integrated Community Mental Health 
Program: This program is funded by Medicaid, 
Federal block grant dollars, and State-only money. 
RSNs use the Federal block grant and State-only 
dollars for emergency services, intake, and the gen- 
eral assistance population. RSNs are capitated and 
at risk. There is no reinsurance or risk sharing pool. 

Contracts with PHPs/RSNs are on a capitated 
basis for the provision of all inpatient and outpatient 
mental health services. Medicaid provides funding 
for mental health services included in the capitation 
rate. These funds cover approximately one visit per 
client per month. 

The subcontracted BHMCOs are provided an 
administrative fee that reflects the number of people 
authorized for services at the beginning of each 
month. The BHMCO shares no financial risk with 
the RSN. Savings are reinvested into a system for 
the creation of innovative programs to assist clients 
with mental illness. 

Washington hired a private actuarial firm to cal- 
culate the capitation rates. The rates are based on 
expenditures incurred for outpatient community 
mental health rehabilitation and community psychi- 
atric inpatient services. The rates were calculated 
RSN by RSN and category by category, with sepa- 
rate inpatient and outpatient rates for Medicaid eli- 
gibles. RSNs are given a per member per month 
payment that is split into inpatient and outpatient. 
Outpatient is further subdivided into children and 
adults, with seven risk categories for each. 



The reimbursement mechanism for providers 
varies by RSN. King County, for example, has a tier 
system in which they give an allotted amount to 
providers. In general, however, most RSNs do per- 
formance- or outcome-based contracting. 

BHP: The plan establishes on a prepaid capitat- 
ed basis for basic health care services administered 
by the Washington State HCA. Payment for cover- 
age is made through monthly premiums (full premi- 
ums or reduced premiums with State subsidy) and 
co-pays at the time of service. The amount of the 
monthly premium is based on age, family size, 
income, and health plan chosen. 

Coordination Between Primary and 
Behavioral Health Care 



Section i9i5[h) - Integrated Community Mental Health 
Program: Unknown. 

Consumer^Family Involvement 



Section i9i5[h] - Integrated Community Mental Health 
Program: The RSNs contracts specify that 50 per- 
cent plus one consumer or family member will be 
represented on their boards. Additionally, 
Regional Support Advisory Committees have been 
formed that have consumer and family member 
participation. 

BHP: Unknown. 

Future Plans 

Section i9i5(b') - Integrated Community Mental Health 
Program: None. 

BHP: Washington State Psychological Associa- 
tion is working on legislation that would establish a 
task force to study the advisability of managed care 
programs for public mental health and substance 
abuse programs. 

* New Program Under Development: The State 
requested a waiver of the Institution for Mental 
Diseases (IMD) exclusion for pregnant women in 
residential care for substance abuse treatment. 

* Neip Program Under Development: Washington 
Department of Health will be conducting mandated 
benefit sunrise review on mental health parity 

* Neui Program Under DevelopmaU: Washington 
State HCA is using a RWJ grant to test health-sta- 
tus-based risk adjustment as a new system of reim- 
bursement, that is, managed care organizations 



July 31, 1998 



2S7 



(MCOs) will receive higher premiums for sicker 
populations of patients and lower premiums for 
healthy patients. The ultimate goal of the project is 
to have K4COs manage care, not risk. 

State Agency Administration 



Washington's Medicaid, Mental Health, and 
Substance Abuse agencies are all housed under an 
umbrella agency, the Department of Social and 
Health Services. Medicaid is within the Medical 
Assistance Administration, Mental Health within 
the Mental Health Division, and Substance Abuse 
within the DASA. 

Welfare Reform 

Welfare reform legislation was enacted in 
Washington State during the 1997 legislative ses- 
sion. The current legislation rescinded the previous 
State statute and required conformity with the 
Federal welfare act. The current legislation requires 
participation in treatment as a condition of eligibil- 
ity for welfare recipients who are chemically depen- 
dent and need treatment. Drug testing is not 
mandatory for TANF eligibles. The plan also pro- 
vides welfare benefits to persons convicted of a 
drug-related felony after August 22, 1996, under 
specific conditions, one being participation in 
chemical dependency treatment. Mental health ser- 
vices are also provided to these individuals, howev- 
er, these services are considered part of the 
Medicaid service package. 

County 

• Clark County: Clark County contracts with a 
commercial MCO to handle prior authoriza- 
tion, triage services, and day-to-day manage- 
ment of the program. Clark County is one of 
only two areas running their own program 
because of their population mass. 

• Unified Services Initiative: King County 
Mental Health Division integrates management 
of both inpatient and outpatient mental health 
services. The Seattle/King County Public 
Health Department created a Bureau of Unified 
Services that has been responsible for providing 



a single access point for service delivery to 
clients. The mission statement is centered on 
the theory of "no wrong door," meaning that 
clients who need services can access care no 
matter what "door" they enter. 

• King County: Under the County Executive, 
King County Human Resources, the Division 
of Children and Family Services, King County 
Mental Health Prepaid Health Plan, King 
County Department of Alcohol and Substance 
Abuse, Department of Developmentally 
Delayed, Division of Youth Services, and 
School Districts will blend their funds and pro- 
vide child welfare services (including mental 
health and substance abuse services) under an 
ASO model using a case rate reimbursement 
system. 

Evaluation Findings 

• The Washington State Institute for Public 
Policy will help the State evaluate outcomes 
associated with the State's welfare reform pro- 
gram. 

• Additionally, State legislation created the 
Washington Institute for Mental Health 
Research and Training, which conducted an 
analytical evaluation of RSN implementation. 

• DASA developed a statewide outcome-based 
management information system that measures 
the status of client health and social functional- 
ity indicators across time. 

• DASA operates a management information sys- 
tem that collects client demographic informa- 
tion, services provided to clients, and social and 
behavioral milestones of client status at admis- 
sion and discharge. 

• DASA goes beyond outcome measures afforded 
by the management information system by con- 
ducting studies that measure cost offsets and 
health status improvement. 

• DASA conducts an ongoing comprehensive 
6-month follow-up of clients in all publicly 
funded treatment programs. 

Other Quantitative Data 

Not applicable. 



258 



{SAMHSA} Managed Care Tracking System 



WEST VIRGIN I A 



OVERVIEW 



West Virginia currently does not have a Federal waiver for managed behavioral health care services. 
However, behavioral health services are being managed under the New Directions in Medicaid 
Services Initiative, a program that requires providers to administer functional assessment instruments 
to service recipients on a quarterly basis. New Directions targets Medicaid clinic and rehabilitation 
services. Providers administer functional assessment instruments to service recipients on a quarterly 
basis during the first year of the initiative. Data collected on the degree of impairment and clinical 
outcomes of recipients are then used to match level of care to level of need for all behavioral health 
treatment services, regardless of the source of funding. This will lay the groundwork for the estab- 
lishment of case rates. 

During Phase II, utilization management and utilization review mechanisms, prior authorization, 
and care criteria services will be established. 




Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 
Not applicable. 

Medicaid Voluntary 

New Directions in Medicaid Services Initiative - Medicaid program - behavioral health stand-alone: The 
New Directions Initiative has four goals: I) to integrate various funding streams so that they support 
a coherent system of behavioral health services; 2) to improve quality of behavioral health services 
for children and adults; 3) to ensure that consumers receive the services they need, when needed and 
in the amount needed; and 4) to establish a rational system of cost containment. 



Other Managed Care Programs 
Not applicable. 



Geographic Location 

New Directions in Medicaid Services Initiative: Statewide. 

Status of Programs 



New Directions in Medicaid Services Initiative: imple- 
mented November 1996. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Outpatient, acute detoxification. 

Medicaid Mental Health Services 
Remaining Fee-For^Service 



Inpatient; outpatient (e.g., clinic services). Insti- 
tution for Mental Diseases services for individuals 



age 65 and over and age 2 1 and under,- mental health 
rehabilitation (e.g., targeted case management). 

Medicaid Substance Abuse Services in 
Managed Care Plan 

New Directions in Medicaid Services Initiative: Outpatient 
(e.g., clinic); residential substance abuse treatment 
programs (e.g., non-hospital-based settings). 

Medicaid Mental Health Services in 
Managed Care Plan 

New Directions m Medicaid Services Initiative: Outpatient 
(e.g., clinic); mental health rehabilitation (e.g., case 
management services). 



July 31, 1998 



2S9 



Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 



Financing of Plans 



New Directions in Medicaid Services Initiative: Not 
applicable. 

Populations Covered Under Managed 
Behavioral Health 



New Directions in Medicaid Services Initiative: Children 
and adults voluntary: Medicaid populations: Aid to 
Families with Dependent Children/Temporary 
Assistance for Needy Families (AFDC/TANF), 
Supplemental Security income and State mental 
health allocation populations: general assistance. 

State Managed Care Program 
Administration 



New Directions in Medicaid Services Initiative: The 
Department of Health and F^uman Resources 
(DFHF4R) has lead responsibility for this program 
and contracts with any willing provider. Providers 
are not at risk for services, however, they are 
required to use standardized functional assessment 
instruments to determine medical necessity. The 
data reported from the instruments are used by con- 
sensus panels to determine service packages that 
match level of care and level of need. The intent is 
to use the data collected in Phase 1 of the initiative 
to establish the standards for utilization manage- 
ment statewide. 

During Phases 11 and 111, a defined set of service 
packages will be developed by consensus panels 
and implemented. Consensus panels are composed 
of consumers, family members, providers, and ser- 
vice system experts. They provide guidance to clin- 
icians on acceptable service intensity and cost 
given the level of impairment. The service delivery 
models will begin to be evaluated in relation to best 
practices. 



New Directions in Medicaid Services Initiative: The source 
of funds is Medicaid dollars. At present, the pro- 
gram does not involve capitation. The proposed 
methodology will develop case rates and capitated 
rates from the data being collected related to service 
utilization, cost, and the relationship to functional 
impairment. Providers are not currently at risk. 

Coordination Between Primary and 
Behavioral Health Care 

New Directions in Medicaid Services Initiative: Unknown. 
Consumer^Family Involvement 



New Directions in Medicaid Services Initiative: The New 
Directions Initiative was designed by engaging a 
variety of stakeholders, including DHFHR represen- 
tatives, providers of Medicaid-reimbursed behav- 
ioral health services, and consumers and family 
members. A consumer satisfaction evaluation is 
being managed by consumer groups who are coor- 
dinating their efforts with the DF4F4R Office of 
Behavioral FHealth Services (OBF4S). in addition, a 
report card on the behavioral health system will be 
issued under this initiative. It will provide informa- 
tion on the level of functioning of consumers, some 
short-term outcomes, cost, and consumer and fami- 
ly satisfaction for each provider and for the overall 
system. Consumers are included in all aspects and 
serve on the Quality Control Council, consensus 
panels, and design teams. The planning process has 
been characterized by representatives of consumers 
and families joining with OBHS staff to develop the 
initiative. Consumer and family organizations have 
been strengthened owing to the implementation of 
a Leadership Academy and their increased involve- 
ment with the Mental F4ealth Planning Council and 
Council Plus. 

Future Plans 

New Directions in Medicaid Services Initiative: The State 
hopes to begin paying providers case rates or capi- 
tation rates for all clients in the program. 

State Agency Administration 



The Medicaid authority is the Bureau for Medical 
Services, within the Department of FHealth and 



260 



{SAMHSA} Managed Care Tracking System 



Human Services. The mental health authority, the benefits to drug felons but does not test recipients 

OBHS, and the substance abuse authority, the for drug use. 

Division of Alcoholism and Drug Abuse, are both 

also housed in the Department of Health and County 

Human Services. 



Welfare Reform 



West Virginia filed a state plan under P.L. 104-193 
with the U.S. Department of Health and Human 
Services on November 27, 1996, which became 
effective January 11, 1997. The program denies 

Not applicable 



Not applicable. 

Evaluation Findings 

Not applicable. 

Other Quantitative Data 



July 31, 1998 261 



WISCONSIN 



OVERVIEW 



Wisconsin is piloting a number of managed care plans designed around a specifically defined popu- 
lation. The State has seven managed behavioral health care programs, one of which is pending 
Health Care Financing Administration (HCFA) approval. The Medicaid agency operates an Aid to 
Families with Dependent Children/Fiealthy Start health maintenance organization program that 
includes mental health and substance abuse services and five specialized managed care programs. 
Two county-based programs are behavioral health stand-alone plans for children with severe emo- 
tional disturbance (SED). The remaining three managed care programs are designed for special pop- 
ulations (e.g., elderly, physically disabled, AIDS) and combine physical health and behavioral health 
services. The pending Section 1115 waiver will provide managed physical as well as behavioral health 
services to the uninsured and underinsured. 




Managed Care Programs for Behavioral Health Services 

: Medicaid Waivers 

I Section 1915(b) - Medicaid HMO Program - Integrated: Program that covers physical health as well as 

i acute care mental health and substance abuse services. 

I Section 1115- BadgerCare - integrated: Provides system of care to uninsured and underinsured families. 

i: Medicaid Voluntary 

I Children Come First (CCF) - behavioral health stand-alone: Covers mental health and substance abuse 

I services for children with SED in Dane County. 

WrapAround Milwaukee (WAM) - behavioral health stand-alone: Covers mental health and substance 

I abuse services for children with SED in Milwaukee County. 

I Independent Care - (l-Care) - integrated: Covers acute care mental health and substance abuse services 
to the Supplemental Security Income (SSI) population. 

Wisconsin Partnership Program (Wl Partnership) - integrated: Covers acute care mental health and sub- 
stance abuse services to the SSI population. 

Program for All-inclusive Care for the Elderly (PACE) - integrated: Covers acute care mental health and 
substance abuse services to frail elderly individuals. 

I Other Managed Care Programs 
Not applicable. 



Geographic Location 

Section {9i5[h) - Medicaid HMO Program: Statewide. 

Section iiis - BadgerCare: Statewide. 

CCF: Dane County. 

WAM: Milwaukee County. 

I-Care: Milwaukee County. 

WI Partnership: Dane, Milwaukee, and EauClaire 
Counties. 

PACE Milwaukee and Dane Counties. 



Status of Programs 

Section (9 {5(b) - Medicaid HMO Program: Approved 
September 27, 1994, implemented September 30, 
1994. 

Section tit5 - BadgerCare: Waiver submitted 
March 21, 1998. Pending HCFA approval Imple- 
mentation of Phase 1 set for July 1, 1998. 

CCF. Implemented April 1993. 

WAM: Implemented March 1997. 

/-Cliff Implemented lul\- 1, 1994. 



July 31, 1998 



263 



WI Partnership: Implemented October 1, 1995. 
PACE: Implemented in Milwaukee: November 
1989; in Dane: January 1995. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 



Outpatient; detoxification; opiate treatment; inpa- 
tient; transportation. 

Medicaid Mental Health Services 
Remaining Fee-For-Service 



Inpatient; Institution for Mental Diseases (IMD) 
services for individuals under age 21; crisis; mental 
health support (e.g., community support programs, 
targeted case management); pharmacy; rehabilita- 
tion (e.g., child/adolescent day treatment); residen- 
tial (e.g., in-home psychotherapy); outpatient (e.g., 
nonphysician providers). 

Medicaid Substance Abuse Services in 
Managed Care Plan 

Section i9i5[h) - Medicaid HMO Program: The follow- 
ing substance abuse services are covered: outpatient; 
detoxification; opiate treatment; inpatient; trans- 
portation. 

Section ms - EadgerCare: The following sub- 
stance abuse services are covered: outpatient; detox- 
ification; opiate treatment; inpatient; transporta- 
tion. 

Medicaid Mental Health Services in 
Managed Care Plan 



Section i9i5(h] - Medicaid HMO Program: The follow- 
ing mental health services are covered: inpatient, 
IMD services for individuals under age 21; crisis; 
mental health support (e.g., community support 
programs, targeted case management); pharmacy; 
rehabilitation (e.g., child/adolescent day treatment); 
residential (e.g., in-home psychotherapy); outpa- 
tient (e.g., nonphysician providers). 

Section iiis - BadgerCare: The following mental 
health services are covered: inpatient; IMD services 
for individuals under age 21; crisis; mental health 
support (e.g., community support programs, target- 
ed case management); pharmacy; rehabilitation 
(e.g., child/adolescent day treatment); residential 
(e.g., in-home psychotherapy); outpatient (e.g., 
nonphysician providers). 



Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

CCF: Provides the following substance abuse ser- 
vices: outpatient, detoxification, opiate treatment, 
inpatient, transportation. 

VKAM. Provides the following substance abuse 
services: outpatient; detoxification, opiate treat- 
ment, inpatient, transportation. 

I-Care: Provides the following substance abuse 
services: outpatient, detoxification, opiate treat- 
ment, inpatient, transportation. 

WI Partnership: Provides the following substance 
abuse services: outpatient, detoxification, opiate 
treatment, inpatient, transportation. 

PACE: Provides the following substance abuse 
services: outpatient, detoxification, opiate treat- 
ment, inpatient, transportation. 

Non-Hedicaid Mental Health Services in 
Managed Care Plan 

CCF: Provides the following mental health services: 
inpatient; IMD services for individuals under age 
21; crisis; mental health support (e.g., community 
support programs, targeted case management); 
pharmacy; rehabilitation (e.g., child/adolescent day 
treatment); residential (e.g., in-home psychothera- 
py); outpatient (e.g., nonphysician providers). 

VKAM: Provides the following mental health 
services: inpatient; IMD services for individuals 
under age 21; crisis; mental health support (e.g., 
community support programs, targeted case man- 
agement); pharmacy; rehabilitation (e.g., child/ado- 
lescent day treatment); residential (e.g., in-home 
psychotherapy); outpatient (e.g., nonphysician 
providers). 

I-Care: Provides the following mental health ser- 
vices: inpatient; IMD services for individuals under 
age 21; crisis; mental health support (e.g., commu- 
nity support programs, targeted case management); 
pharmacy; rehabilitation (e.g., child/adolescent day 
treatment); residential (e.g., in-home psychothera- 
py); outpatient (e.g., nonphysician providers). 

WI Partnership: Provides the following mental 
health services: inpatient; IMD services for individ- 
uals under age 2 1 ; crisis; mental health support (e.g., 
community support programs; targeted case man- 
agement); pharmacy; rehabilitation (e.g., child/ado- 
lescent day treatment); residential (e.g., in-home 



264 



{SAMHSA} Managed Care Tracking System 



psychotherapy); outpatient (e.g., nonphysician 
providers). 

PACE Provides the following mental health ser- 
vices: inpatient; IMD services for individuals under 
age 21; crisis; mental health support (e.g., commu- 
nity support programs; targeted case management); 
pharmacy; rehabilitation (e.g., child/adolescent day 
treatment); residential (e.g., in-home psychothera- 
py); outpatient (e.g., nonphysician providers). 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Section i9i5[h) - Medicaid HMO Program: Unknown. 
Section iH5 - BadgerCare: Unknown. 
CCF: Unknown. 
WAM: Unknown. 
I-Care: Unknown. 
WI Partnership: Unknown. 
PACE Unknown. 

Populations Covered Under Managed 
Behavioral Health 

Section i9i5[b] - Medicaid HMO Program: Adults and 
children mandatory: Aid to Families with 
Dependent Children/Temporary Assistance for 
Needy Families (AFDC/TANF); pregnant women 
and children up to 165 percent Federal poverty level 
(FPL) (Healthy Start); dually eligible Medicare/ 
Medicaid. 

Section ins - BadgerCare: Adults and children 
mandatory: uninsured and underinsured whose 
incomes fall below 185 percent FPL. Families whose 
incomes are 143 percent FPL will be required to pay 
monthly premiums of no more than 3.5 percent of 
their family income. 

CCF: Voluntary: AFDCAANF child and adoles- 
cent clients of Dane County Human Services 
Department. 

WAM: Voluntary: AFDCTTANF child and ado- 
lescent clients of Milwaukee County Human 
Services Department. 

I-Care: Voluntary for individuals age 15 and 
over: SSI, dually eligible Medicare/Medicaid. 
WI partnership: Voluntary: SSI, dually eligible 
Medicare/Medicaid. 

PACE: Voluntary: SSI, dually eligible Medicaid/ 
Medicare. 



State Managed Care Program 
Administration 



Section i9i5[h) - Medicaid HMO Program: Medicaid 
contracts with 19 HMOs licensed by the Wisconsin 
Office of the Commissioner of Insurance for service 
provision of this program. The HMO panel is open. 

Section Hi5 - BadgerCare: The program adminis- 
tration will be the same as under the 1915(b) waiv- 
er. BadgerCare will essentially be composed of two 
delivery systems: An HMO system and a subsidized 
employer-based system. Those family members 
who qualify for AFDCAANF will fall into the 
HMO system, and those families with access to 
employer coverage will be subsidized in addition to 
wraparound services provided to bring this popula- 
tion up to Medicaid coverage. 

CCF: Medicaid contracts with Dane County for 
administration of this program. Therefore, Dane 
County is responsible for the operational adminis- 
tration of the program and subcontracts for mental 
health and substance abuse services. 

Vl/AM. Medicaid contracts with Milwaukee 
County for administration of this program. 
Therefore, Milwaukee County is responsible for 
the operational administration of the program and 
subcontracts for mental health and substance abuse 
services. 

I-Care: A state-licensed HMO and a communi- 
ty-based organization formed a partnership to 
administer this program. 

WI Partnership: Unknown. 

PACE: Unknown. 

Financing of Plans 



Section i9i5(b) - HMO Program: Medicaid pays full 
capitation for all medical services covered by 
Medicaid except prenatal care coordination and 
common carrier transportation. Two capitation 
rates, one for AFDC and one for Healthy Start, are 
used. Capitation rates vary by regions. Ten rate 
regions divide the State. 

Section ins - BadcjerCarc: BadgerCare will be 
funded through Medicaid dollars. State tax rev- 
enues, and premiums. Anticipated savings of 5 to 8 
percent were built into the capitation rate HMOs 
will be paid a per member per month capitation 
rate. Some services will still be provided on a fee- 
for-service basis. Cost sharing will be a component 



July 31, 1998 



26S 



of BadgerCarc; namely, families with incomes in 
excess of 143 percent FPL will pay a premium of no 
more than 3.5 percent of family income. Premium 
shares are to be collected through wage withhold- 
ing or an alternative, automated system. 

CCF: CCF provides behavioral health services 
under a risk-based, prepaid contract. Dane County 
Human Services provides 95 percent of fee-for-ser- 
vice costs for mental health and substance abuse ser- 
vices in addition to providing payment to cover the 
non-Medicaid services. 

WAM: WAM, which is an expansion of CCF, 
was initially a 5-year Center for Mental Health 
Services grant. The program is now joindy funded 
through the Department of Health and Family 
Services (DHFS) and Milwaukee County 
Department of Human Services (DHS). Milwaukee 
County DHS provides 95 percent of fee-for-service 
costs for mental health and substance abuse services 
in addition to providing payment to cover the non- 
Medicaid services. 

I-Care: The State pays a capitation rate of 100 
percent of the Medicaid fee-for-service costs per 
member per month. 

WI Partnership: Unknown. 

PACE: Unknown. 

Coordination Between Primary and 
Behavioral Health Care 

Section I9i5[b] - Medicaid HMO Program: Under the 
Medicaid HMO program, the HMOs are responsi- 
ble for care coordination. 

Section Hi 5 - BadgerCare: Unknown. 

CCF: Under the voluntary CCF program, man- 
agement and integration of mental health care and 
community support services are coordinated 
through a primary case coordinator. 

WAM: Unknown. 

I-Care: Unknown. 

WI Partnership: Unknown. 

PACE Unknown. 

Consumer^Famiiy Involvement 



Section i9i5(b) - Medicaid HMO Program: Unknown. 

Section iiis - BadgerCare: Unknown. 

CCF: Under the CCF program, the County is 
planning efforts to improve the health care delivery 
system through member feedback through focus 



groups, consumer advisory councils, member partic- 
ipation on the governing board, the quality 
improvement committees or other committees, or 
task forces related to evaluating services. 

WAM: Unknown. 

I-Care: Unknown. 

WI Partnership: Unknown. 

PACE: Unknown. 

Future Plans 

Section 1915 [h] - Medicaid HMO Program: Wisconsin 
Medicaid is in the early planning stages of expand- 
ing managed behavioral health care for a significant 
portion of the non-AFDC population. This plan 
may also include Medicare-eligible individuals and 
uninsured or underinsured individuals currently 
being served by counties. As such, this program may 
go beyond Medicaid to cover all individuals cur- 
rently served by the public sector. 

Section iii5 - BadgerCare: Implement Phase 11. 

CCF: None. 

WAM: None. 

I-Care: Persons with disabilities who are 
Medicaid eligible through SSI will have the option 
of receiving health care through the managed care 
system voluntarily. The individual will receive care 
through the fee-for-service system if he or she does 
not choose the managed care system. 1-Care will 
expand to Kenosha and Racine Counties by January 
1999 to tailor the needs by requiring 

• Multiple medications to treat chronic condi- 
tions, 

• Intensive coordination, case management, and 
medication management services,- and 

• Assistance with housing, employment, and rela- 
tionship issues. 

DHFS is currently developing a certification 
document, contract language, and capitation rates 
for managed care organizations that choose to par- 
ticipate. If this SSI Medicaid managed care program 
proves successful in Kenosha and Racine Counties, 
the State will expand this option statewide. 

WI Partnership: None. 

PACE: None. 

* biew Program Under Development: The 
Governor's Blue Ribbon Commission on Mental 
Health consists of representatives from the govern- 
ment, the mental health professions, and the public 
and private sectors who have an interest in the 



266 



{SAMHSA} Managed Care Tracking System 



future direction of mental health care in Wisconsin. 
They developed a long-term plan for mental health 
services. Some of their suggestions included the fol- 
lowing: 

• Organize the mental health system around the 
concept of recovery,- 

• Identify persons to be served and divide those 
individuals into different groups based on the 
level of need for services provided, 

• Increase consumer involvement in all levels of 
planning and oversight of the system,- 

• Identify consumer-level outcomes that should 
be used to measure performance of the system,- 

• Set aside funding for prevention activities,- 

• Outline core services that should be part of the 
system, there should be creativity and flexibili- 
ty in designing individualized services around 
the core services,- 

• Address stigma,- 

• Merge State, county, and Medicaid dollars that 
are currently providing mental health treat- 
ment,- 

• Build on the current county-based system as the 
development of managed care in the area con- 
tinues, and 

• Examine Medicaid waivers to allow for behav- 
ioral health managed care and supporting pilot 
programs. 

* New Program Under Development Wisconsin is 
developing a long-term care redesign proposal that 
is a thorough, statewide overhaul in the way long- 
term-care services are managed and delivered to the 
elderly and people with mental, physical, or devel- 
opmental disabilities. Wide input is being sought 
from consumer, advocate, and provider groups. The 
changes proposed would not take effect until 
around the year 2000. 



State Agency Administration 



DHFS consists of five divisions; Children and 
Family Services,- Supportive Living, Care and 
Treatment Facilities, F4ealth,- and Management and 
Technology. The Division of Supportive Living 
houses mental health and substance abuse under the 
Bureau of Community Mental Health and the 
Bureau of Substance Abuse Services, respectively. 
Within the Division of F4ealth, the Bureau of 
F^ealth Care houses Medicaid. 

Welfare Reform 



Wisconsin Works (W-2) is Wisconsin's welfare 
reform plan based on work that has been in 
statewide operation since September 1997. Physical 
health care under W-2 is delivered through man- 
aged care providers. Coverage is available to all 
low-income families, including children through 
age 18. Families pay a portion of their health care 
premium based on income, with the State paying 
the difference. Families with low incomes will pay 
only a nominal portion of the premium amount, 
which will rise as income increases. Working fami- 
lies who are eligible for employer-provided cover- 
age are required to accept it (or other private cover- 
age). Also included under this plan is the denial of 
TANF to individuals convicted of drug felonies. 
Legislation is pending that would require mandato- 
ry drug testing of all welfare clients. 



County 

Not applicable. 



Evaluation Findings 

Unknown. 

Other Quantitative Data 

Not applicable. 



July 31, 1998 



267 



WYOMI NG 



OVERVIEW 

Wyoming does not operate any Medicaid waivers for behavioral health care and has never applied 
for such a waiver. Wyoming has no plans for managed behavioral health care. However, it is consid- 
ering various reforms for the public mental health system. 

Managed Care Programs for Behavioral Health Services 



Medicaid Waivers 
Not applicable. 

Medicaid Voluntary 
Not applicable. 

Other Managed Care Programs 
Not applicable. 




Geographic Location 

Not applicable. 

Status of Programs 

Not applicable. 

Medicaid Substance Abuse Services 
Remaining Fee-For-Service 

Residential substance abuse treatment programs 
(e.g., non-hospital-based care settings). 

Medicaid Mental Health Services 
Remaining Fee-For-Service 



Inpatient, mental health rehabilitation (e.g., target- 
ed case management). 

Medicaid Substance Abuse Services in 
Managed Care Plan 



Not applicable. 

Medicaid Mental Health Services in 
Managed Care Plan 

Not applicable. 



Non-Medicaid Substance Abuse Services in 
Managed Care Plan 

Not applicable. 

Non-Medicaid Mental Health Services in 
Managed Care Plan 



Not applicable. 

Substance Abuse Prevention and Mental 
Health Promotion in Managed Care Plan 

Not applicable. 

Populations Covered Under Managed 
Behavioral Health 

Not applicable. 

State Managed Care Program 
Administration 



Not applicable. 

Financing of Plans 

Not applicable. 



July 31, 1998 



269 



Coordination Between Primary and 
Behavioral Health Care 



Not applicable. 

Consumer-Family Involvement 

Not applicable. 

Future Plans 

* New Program Under Development: The Governor has 
endorsed recommendations of the Select 
Committee and Partnership on Mental Health to 
reform the mental health system. However, his sup- 
port is conditioned upon targeting services to adults 
with severe and persistent mental illness and chil- 
dren with severe emotional disturbances as its first 
priority. First-year funding for targeted services 
began July 1, 1997. 

State Agency Administration 

The Medicaid authority in Wyoming is the Division 
of Health Care Financing, which is under the 



Department of Health. The mental health and sub- 
stance abuse authority is the Division of Behavioral 
Health, within the Department of Mental Health. 

Welfare Reform 

Wyoming filed a state plan under RL. 104-193 with 
the U.S. Department of Health and Human 
Services on October 16, 1996, which became effec- 
tive January 1, 1997. The program provides benefits 
to drug felons and does not test recipients for drug 
use. 

County 

Not applicable. 

Evaluation Findings 

Not applicable. 

Other Quantitative Data 

Not applicable. 



270 



{SAMHSA} Managed Care Tracking System 



Appendix A: Project Background 



Between 1995 and 1997, under contract from SAMHSA's Office of Managed Care, a prototype system was 
created to track and monitor managed mental health and substance abuse care in the public sector. The pro- 
totype was initiated by the Mental Health Policy Research Center with the George Washington University 
Center. During that time, project efforts focused on collecting baseline information related to Medicaid man- 
aged behavioral health care waivers. As it became available, information on welfare reform, non-Medicaid 
managed care, and State agency reorganization was added to the database. 

In September 1997, a new 3-year contract was awarded to do the following: 

• Update baseline information on Medicaid managed care, welfare reform, and non-Medicaid programs,- 

• Expand data collection to include new priorities and new types of information,- 

• Develop new products to disseminate information, and 

• Analyze data from the national database. 



During the initial project year, new and expanded data were collected and added to the database in the 
following areas: 

Role of substance abuse prevention and mental health promotion in managed care programs,- 

Role and responsibilities of managed care entities, providers, and States,- 

Risk arrangements and managed behavioral health care programs (provider and managed care entity),- 

Characteristics of managed behavioral health care provider networks,- and 

Administration, organization, and financing of non-Medicaid managed care programs operated by single 

State authorities for mental health and/or substance abuse. 

Another important addition to the 1998 Tracking System is the creation of a database that "codes" the 
Nation's publicly funded managed behavioral programs. The 1997 profiles were reviewed and analyzed for 
information regarding their status, implementation, financing, risk, scope, populations, covered services, and 
relation to physical health benefits. Analyses of the 1997 data are included in Section III of this document. 
The analysis compares and contrasts various features of managed behavioral health (MBH) programs and 
explores the relationship of managed care status and features with State "environmental" variables. For exam- 
ple, it categorizes MBH programs according to such factors as whether the State's administrative responsi- 
bilities are "county-dominated" or centralized at the State level, the extent of Medicaid managed care pene- 
tration in physical health, and growth in mental health and substance expenditures as a precursor to managed 
care development. This initial analysis is intended to shed further light on the extent and design of MBH pro- 
grams and to illustrate State factors in the financing and management of behavioral health services. Analysis 
of the 1998 profiles will be conducted during the second project year (beginning October 1, 1998). 



July 31,1998 Al 



Appendix B; Glossary 



administrative services only (ASO) contract A contract between an insurance company and a self- 
funded plan under which the insurance company performs administrative services only (e.g., 
claims processing). 

AFDC/TANF Aid to Families with Dependent Children and Temporary Assistance for Needy Families 
have been grouped together because although TANF has replaced the AFDC terminology, eligi- 
bility for Medicaid still relies on previous AFDC eligibility established prior to the welfare 
reform legislation that created TANF. Furthermore, individuals who met eligibility criteria that 
were in effect on July 16, 1996, are eligible for Medicaid. The eligibility criteria are based on a 
percentage of the Federal poverty level (FPL),- this percentage varies from State to State. Specific 
populations covered under AFDCATANF include children, pregnant women, and low-income 
families. 

behavioral health Care provided for the treatment of mental and/or substance abuse disorders. 
Substance abuse includes alcohol and drugs, 

behavioral health managed care organization (BHMCO) An organization that manages, admmisters 
and/or provides mental health and substance abuse benefits carved out from the general health 
plan that is provided by insurers and self-insured companies. 

capitation/capitation fee/capitation payment A prospective payment method that pays the managed 
care entity (or provider) a uniform amount for each person served, usually on a monthly basis. 

case rate A "package price" for a specific procedure or diagnosis-related group,- for example, the physi- 
cian case rate for obstetrics includes all prenatal visits, labor, delivery, and one postpartum exam- 
ination. 

clinical criteria Often, non-Medicaid programs do not base program eligibility on income thresholds 

but on clinical criteria, such as serious mental illness, at risk for placement in foster home, or his- 
tory of substance abuse. 

comprehensive care Provision of a broad spectrum of health services that are required to prevent, 

diagnose, and treat physical and mental illnesses and to maintain health (includes physicians' ser- 
vices and hospitalization). 

consumer A person who receives and/or purchases services,- sometimes differentiated from "customer" in 
that a consumer also advocates for service quality and appropriateness, whereas a customer is 
any person receiving and/or purchasing services. 

co-payment The portion of a claim or medical expense that a member (or covered insured) must pay 
out of pocket, usually a fixed amount. 

coverage Services or benefits provided through a health insurance plan. 

delivery system An organized array of service providers coordinated to deliver a set package of 
services. 

dual diagnosis Diagnosis with more than one disorder, usually used to refer to a combination of mental 
health and substance abuse problems, but the term can also refer to individuals who have a 
behavioral health diagnosis as well as a medical diagnosis or disability. 



July 31, 1998 Bl 



dually eligible Typically, those individuals who qualify for Medicaid and Medicare on the basis of age 
(65 for Medicare) and income threshold (usually 133 percent of FPL for Medicaid), This classifi- 
cation was not separated into its own population category in the report (see Section 1), but 
many programs list the dually eligible as a group covered. 

enrolled population The entire group of persons covered by a particular health plan, defined in terms 
of specific lives covered. Persons enrolled are referred to as enrollees. 

exclusion model A model in which States adopt a managed care program for physical health but 
exclude behavioral health services and keep them in the fee-for-service system. 

expanded medicaid Some States may choose to expand their Medicaid eligibility threshold in order to 
cover more individuals under their Medicaid program. For example, a typical income eligibility 
threshold might be 1 33 percent of FPL, but the State may choose to expand Medicaid coverage 
to include those individuals with incomes up to 300 percent of FPL. 

expanded women and children States may choose to cover additional groups under their Medicaid 

programs, usually additional children and pregnant women whose medical expenses reduce their 
income to the State's ceiling to qualify as medically needy. Examples of these groups include 
infants whose family income is up to 185 percent of FPL, pregnant women with incomes up to 
1 85 percent of FPL, and children under age 2 1 (primarily 1 8- to 2 1 -year-olds) who meet certain 
income and resource requirements under AFDC/TANF but are otherwise not eligible for 
Medicaid. 

fee-for-service (FFS) reimbursement A payment approach that pays providers for each unit of service 
delivered. 

full capitation A term often used more broadly than the strict definition of "capitation" to refer to any 
payment system in which a managed care organization provides and bears the utilization risk for 
all services included in the benefit package according to a prospectively funded at-risk contract- 
ing arrangement tied to covered lives. 

full carve-out model A model of care in which States separate mental health and substance abuse ser- 
vices and/or populations from the physical health care program, and include them under a sepa- 
rate behavioral health managed care waiver program. 

funding method The mechanism through which a payer (e.g., Medicaid, employer. State Mental 
Health Authority) pays for the health care of its covered persons. 

general assistance Category covering low-income persons who are not eligible for federally funded 
cash assistance (e.g., AFDCAANF,- SSI) and who receive cash and/or in-kind benefits from the 
State, county, and/or locality in which the program operates. 

health maintenance organization A health care organization that 1) offers an organized system for 
providing health care within a specific geographic area, 2) provides a set of basic and supple- 
mental health maintenance and treatment services, and 3) provides care to an enrolled group of 
people. 

Institution for Mental Diseases (IMD) The FHealth Care Financing Administration classification often 
applied to state hospitals that excludes services for persons age 21 to 64 from coverage under 
Medicaid; included in original Medicaid legislation to prevent states from shifting the cost of 
State hospitals to the Federal government. 

integrated model Mental health and substance abuse services included in a comprehensive general 
physical health managed care program. 



B2 {SAMHSA} Managed Care Tracking System 



lead agency An organization that serves as the single clinical and fiscal authority that provides and/or 
subcontracts for services toward the achievement of a desired outcome. 

local mental health authority A local organizational entity (usually with some statutory authority) that 
centrally maintains administrative, clinical, and fiscal authority for a geographically specific and 
organized system of behavioral health care. 

managed behavioral health care Any of a variety of strategies to control behavioral health (i.e., men- 
tal health and substance abuse) costs while ensuring quality care and appropriate utilization. 
Cost-containment and quality-assurance methods include the formation of preferred provider 
networks, gatekeeping (or precertification), case management, relapse prevention, retrospective 
review, claims payment, and others, in many health plans, behavioral health care is separated 
from other care for the separate management of costs and quality of care. 

managed health care An arrangement for health care delivery and financing that is designed to provide 
appropriate, effective, and efficient health care through organized relationships with providers,- 
includes formal programs for ongoing quality assurance and utilization review, financial incen- 
tives for covered members to use the plan's providers, and financial incentives for providers to 
contain costs. 

managed care organization (MCO) An entity, such as an HMO or preferred provider organization, 
that provides a managed health care plan. 

managed fee-for-service (indemnity) product A plan in which the cost of covered services is paid by 
the insurer after services have been used. Various managed care tools such as precertification, 
second surgical opinion, and utilization review are used to control inappropriate utilization. 

Medicaid A Federal program administered individually by participating State and Territorial govern- 
ments that share in the program's costs to provide medical benefits to specific groups of low- 
income and/or categorically eligible persons. 

Medicaid managed care demonstration A State-initiated managed health care plan undertaken m 
accord with a procedural waiver for some or all of a State's Medicaid-eligible persons. 

Medicaid waiver Waivers such as the Section 1115 waiver and Section 1915(b) waiver. 

medical necessity The determination that a specific health care service is medically appropriate, neces- 
sary to meet the person's health needs, consistent with the person's diagnosis, the most cost- 
effective option, and consistent with clinical standards of care. 

multiple funding streams A funding method in which funding flows to a service provider in indepen- 
dent streams from various funding sources. 

organized systems of care A coordinated network of provider organizations. 

outcomes The results of a specific health care service or benefit package. 

outpatient care Health care not requiring a stay in a licensed hospital or nursing home bed. 

partial capitation A payment system in which some services included in the benefit package are funded 
according to an at-risk contracting arrangement and some through fee-for-service or other tradi- 
tional form of reimbursement. 

partial carve-out model A model in which States use an integrated approach for some mental health 
and/or substance abuse services but place other (and often expanded) mental health ser\'ices 
and/or populations under a separate managed care program. 



July 31. 1998 B3 



payer The public or private organization responsible for payment for health care expenses. 

performance goals The desired level of achievement of standards of care or service. These may be 
expressed as desired minimum performance levels (thresholds), industry best performance 
(benchmarks), or the permitted variance from the standard. Performance goals usually are not 
static but change as performance improves and/or the standard of care is refined. 

performance measures Methods or instruments to estimate or monitor the extent to which the actions 
of a health care practitioner or provider conform to practice guidelines, medical review criteria, 
or standards of quality. 

pooling The process of combining all claims or cost experience for defined populations or types of cov- 
erage into one risk pool in order to spread risk or claims liability. 

preferred provider organization (PPO) An organization that contracts with specific providers to pro- 
vide health care services to enrollees, and structures its benefit package to provide incentives for 
the use of these contracted providers. 

prepaid health plan (PHP) A contract between an insurer and a subscriber or group of subscribers 
whereby the PHP provides a specific set of health benefits in return for a periodic premium. 
PHPs are usually clinics or large group practices and are typically at risk for ambulatory services 
but not for a comprehensive set of benefits. 

primary care case management (PCCM) A managed care option, allowed under section 1915(b) of 
the Social Security Act, in which each participant is assigned to a single primary care provider 
who must authorize most other services before the provider can be reimbursed by Medicaid. 

primary care physician (PCP) The physician responsible for coordinating and managing a member's 
health care needs, including hospitalization or referral to a specialist. 

privatization The effort to shift traditional functions formerly carried out by governmental agencies to 
private sector organizations, usually under the rubric of managed care,- most often involves man- 
agement and financing functions. 

provider Person or organization providing health care services. 

public/private partnership A joint venture between public and private organizations that attempts to 
combine private sector expertise in managed care models and techniques with public sector 
expertise in models of care for seriously impaired or low-income populations. 

quality assessment Measurement of the technical and interpersonal aspects of health care and the out- 
comes of that care. 

quality assurance A systematic and objective approach to improving the quality and appropriateness of 
medical care and other services, includes a formal set of activities to review, assess, and monitor 
care and to ensure that identified problems are addressed appropriately. 

risk The difference between projected and actual expenses. Risk strategies are approaches taken to 

decide who will assume responsibility for paying for, or otherwise provide, a specified set of ser- 
vices based upon unpredictable need for a particular set of services. Risk strategies require man- 
aged care entities or providers to assume all or some portion of the financial risks of treatment. 

risk sharing The process of establishing a financial arrangement that distributes the financial risk of 
providing care among providers, payers, and those who use the services. 

risk shift The transfer of risk for the costs of services from one responsible party to another, either 
through explicit contract or de facto practice. 



B4 {SAMHSA} Managed Care Tracking System 



Section 1115 research and demonstration A statutory provision that allows a State to operate its sys- 
tem of care for Medicaid enrollees in a manner different from that prescribed by the Health 
Care Financing Administration in an attempt to demonstrate the efficacy and cost-effectiveness 
of the alternative delivery system through research and evaluation. It is sometimes referred to as 
a "comprehensive" or "super waiver," and usually applies to a large number of Medicaid eligibles 
and a comprehensive range of services. 

section 191 5(b) A statutory provision that allows a State to partially limit the choice of providers for 
Medicaid enrollees. For example, under the waiver a State can limit enrollees from disenrolling 
from an FHMO more than once a year. Even though this type of waiver is narrower than the 
1115 waivers, it still allows States to experiment with managed care systems. 

service area The geographic area covered by a managed care plan, where direct services are provided. 

SSI or ABD Federal Supplemental Security Income (SSI) (sometimes referred to as the program that 
serves "aged, blind, and disabled" (ABD) individuals) is based on age, disability, and income. 
Adults under age 65 and children may qualify for SSI by virtue of physical disability, blindness, 
mental illness, mental retardation, or developmental disability. 

stakeholders Groups of persons with a vested interest in the design and functioning of a service or 

product. For public behavioral health care, stakeholders include consumers, family members of 
consumers, service providers, legislators. State mental health and substance abuse agencies, and 
managed care organizations. 

state alcohol and drug abuse authority or agency A State government agency charged with adminis- 
tering and funding the State's substance abuse health services. 

state mental health authority or agency A State government agency charged with administering and 
funding the State's public mental health services. 

stop-loss (risk control insurance) Insuring with a third party against a risk that the plan cannot fman- 
cially manage. For example, a health plan can self-insure hospitalization costs, or it can insure 
hospitalization costs with one or more insurance carriers. 

subcapitation An arrangement whereby a capitated health plan pays its contracted providers on a capi- 
tated basis. 

subcontract The act of delegating through a second contract with a third party contractual obligations 
between two original parties. 

unified funding stream A funding arrangement in which funding flows to a service provider in a single, 
unified stream consolidated by the payer from multiple funding sources. 

utilization The extent to which eligible individuals use a program or receive a service or group of ser- 
vices over a specified period of time. 

utilization management A system of procedures designed to ensure that the services provided to a spe- 
cific client at a given time are cost-effective, appropriate, and least restrictive. 

utilization review (UR) A retrospective analysis of the patterns of service usage undertaken to deter- 
mine the means for optimizing the value of services provided (i.e., minimize cost and maximize 
effectiveness/appropriateness). 

wraparound coverage A continuum of benefits organized around an individual enrollees treatment 
needs. 



July 31, 1998 B5 



References for Glossary 



EAP (Employee Assistance Professional Association). 1995. Glossary of Employee Assistance Terminology. 
Arlington, VA: Employee Assistance Professional Association, Inc. 

lOM (Institute of Medicine). 1989. Controlling Costs and Changing Patient Care: The Role of Utilization 
Management. Washington, DC; National Academy Press. 

lOM. 1990a. Clinical Practice Guidelines: Directions for a New Program. Washington, DC: National Academy 
Press. 

lOM. 1990b. Medicare: A Strategy for Quality Assurance. Washington, DC: National Academy Press. 

JCAHO (Joint Commission on Accreditation of Healthcare Organizations). 1989. Managed Care Standards 
Manual. Chicago, IL: Joint Commission on Accreditation of Healthcare Organizations. 

JCAHO. 1996. Comprehensive Accreditation Manual for Health Care Networks. Chicago, IL: Joint Commission on 
Accreditation of Healthcare Organizations. 

NCQA (National Committee for Quality Assurance). 1995. Standards for Accreditation , 1995. Washington, 
DC: National Committee for Quality Assurance. 

United HealthCare Corporation. 1994. The Managed Care Resource: The Language of Managed Health Care and 
Organized Health Care Systems. Minneapolis, MN: United HealthCare Corporation. 

Zuckerman, S., Evan, A., and Holahan, J. (August 1997). "Questions for States as They Turn to Managed 
Care." New Federalism: Issues and Options for States. Washington, DC: The Urban Institute. 



B6 {SAMHSA} Managed Care Tracking System 



Appendix C; Behavioral Health Service Definitions 

inpatient 24-hour inpatient mental health and/or substance abuse services that provide medical inter- 
vention for mental health and substance abuse needs for the purpose of stabilizing acute psychi- 
atric and substance abuse conditions. 

IMD Inpatient services provided in an Institution for Mental Diseases. 

crisis Emergency, crisis intervention, or crisis stabilization services that provide short-term psychiatric 
treatment in structured community-based therapeutic environments as an alternative to hospital- 
ization. 

mental health residential 24-hour residential treatment — a community-based facility that offers 24- 
hour residential care as well as treatment and rehabilitation, short-term crisis stabilization, or 
long-term rehabilitation. One example is therapeutic group living: therapeutically planned group 
living delivered on a 24-hour basis for enrollees. A step down from inpatient or an alternative to 
hospitalization. 

mental health outpatient Mental health services (e.g., individual, family, or group therapy) provided in 
an ambulatory care setting such as a mental health clinic, hospital outpatient department, or 
community health center. 

mental health rehabilitation Services to assist individuals to develop or improve task- and role-related 
skills and social and environmental supports needed to perform as successfully and independent- 
ly as possible at home, school, and work,- and in the family, socialization, recreation, and other 
community-living roles and environments of their choice. 

mental health support Services to promote the ability of enrollees to live as safely and independently 
as possible in community settings,- includes the provision for linking to an array of people, 
places, activities, and services that are designed to assist enrollees and, when requested by the 
enrollee, family members and/or significant others in their continuing need to meet the chal- 
lenges of mental illness and recovery. 

outpatient substance abuse Nonresidential ambulatory services provided for the treatment of drug or 
alcohol dependence, without the use of pharmacotherapies. This includes intensive outpatient 
services (all-day care for several days) as well as traditional counseling ( 1 or a few hours per day, 
usually weekly or biweekly). 

detoxification Hospital-based, residential, and ambulatory programs, typically of very short duration 
(e.g., 3 to 14 days), that provide support services and/or medical assistance during withdrawal 
from alcohol or drug dependence. Detoxification programs are not treatment programs per se, 
but may either be connected to treatment programs or provide referrals to treatment. 
Detoxification services may be provided in standard acute-care beds or in specialty detoxifica- 
tion units. 

opiate treatment Treatment programs, usually outpatient, that are licensed by the Food and Drug 
Administration and the Drug Enforcement Agency to administer either methadone or Levo- 
Alpha-Acetyl Methadol (LAAM) as pharmacotherapy adjuncts to traditional rehabilitation ser- 
vices for opiate dependence. (LAAM is a longer-acting version ot methadone.) Opiate treatment 
programs typically provide services lasting from several weeks to many years. 



July 31, 1998 CI 



residential substance abuse treatment Non-hospital-based 24-hour care programs. These range from 
short-term chemical dependency programs (lasting typically less than a month), to longer-term 
residential settings (usually 3 to 6 months), to long-term residential programs, including thera- 
peutic communities (lasting typically between 6 and 18 months). These programs also include 
specialty residential treatment settings for women and their children. 

These service definitions will be adopted by the Health Care Financing Administration in future annual State 
Medicaid Managed Care Surveys (National Summary of State Medicaid Managed Care Programs). The 
definitions were developed by the SAMHSA Managed Care Tracking System. 



C2 {SAMHSA} Managed Care Tracking System 



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